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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Dr. David Gleitman who wrote (33465)	10/29/1999 8:06:00 AM
From: Guardian	Read Replies (1) \| Respond to of 41369

to all from smart investor newsletter this morning: RECENT DEVELOPMENTS: AMERICA ONLINE (NYSE:AOL) As we indicated in our last report, America Online (NYSE:AOL) posted earnings of 15 cents per share, 2 cents better than the First Call consensus estimate of 13 cents and in line with Wall Street's whisper number. Membership growth was strong across the board, with AOL adding around 1.1 million net new members. In addition, CompuServe 2000 added 378,000 members to close the quarter at a total of 575,000 subscribers. In total, there are 18.7 million AOL and 2.2 million CompuServe Classic and CompuServe 2000 members. Usage of AOL's ICQ service was also up sharply, with over 7.6 million new ICQ registered users added in the last quarter. And people are making AOL a greater part of their lives, with an average of 55 minutes of online daily usage. In sum, although AOL did not report blow-out earnings numbers, which disappointed some investors, the underlying results were solid and the company's stock has rebounded quite a bit from its recent lows. On the day of this report, AOL announced a 2:1 split (this split was forecast to the readers of our Smart!Splits report), which we believe will bring more attention back to this stock, so look for movement in this stock price over the short-term. AOL is somewhat unique in that it provides the more average investor with an opportunity to invest in the Internet without taking on all of the risk. Thus, a stock split is likely to be particularly well-received for a company like AOL because it is a well-recognized company and one that more investors will look to as an opportunity to buy into the Internet at a less expensive price (even if the price is the same in real terms). While of course other factors (e.g., economic or tech sector slowdown, rising interest rates, competition) could put AOL's stock under downward price pressure, we think the respectable earnings results, combined with the announced stock split, will give the stock the necessary momentum to move higher.