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

To: Islander99 who wrote (37005)	1/10/2000 9:54:00 PM
From: cassandra9	Respond to of 41369

During their interview with CNBC today, Case said he offered the position of CEO to Levin. Here is what ROBERTSON STEPHENS (at 9:00 tonight) says of the board: "We also like the management: Steve Case, Gerald Levin, Ted Turner, Bob Pittman, Rich Parsons, Michael Kelly-we see the management as an extremely talented and influential group."

To: Islander99 who wrote (37005)	1/10/2000 9:56:00 PM
From: Patherzen	Respond to of 41369

Newly Merged AOL Will be worth $120 individualinvestor.com Senior Analyst: Luciano Siracusano (1/10/00) So, the big question now is: How do you value what will be the mother of all Internet-media plays, AOL Time Warner? A lot depends on whether people view the colossus as an Internet company or a media company. Like this Article? As an Internet company, America Online (NYSE: AOL - Quotes, News, Boards) commands a price to revenue ratio of 29, based on 1999 calendar-year revenue estimates of $5.7 billion. (America Online?s market cap stood at $165 billion before the announcement). By contrast, Time Warner (NYSE: TWX - Quotes, News, Boards), a mature media company that was just beginning to post strong per share profit growth, traded at about three times its $27.3 billion estimated 1999 revenue. Time Warner is projected to grow its top line at about 8-9% annually, while America Online posted 87% annual sales growth over the past five years and is expected to grow revenue by about 35% a year going forward. If one were to split the difference in the current sales multiples, and assign a hybrid Internet/Media multiple of 16 times calendar year 2000?s projected revenue of $38 billion ($30 billion from Time Warner and $8 billion from America Online), the combined entity should be worth about $608 billion. Divide that market cap by the expected share count after the merger (about five billion shares fully diluted) and you get a 12-month target price of $121.50 per share for the new entity. Granted, this is an inexact and quick way to value the company. Because of Time Warner?s large amortization and depreciation expenses, analysts will likely gravitate towards a multiple of the new company?s EBITDA (earnings before interest, taxes, depreciation and amortization). But, at a minimum, it suggests that there is still considerable upside to AOL?s share price, based on current products and services. One thing is clear: Both companies will be far more profitable five years from now than they are today. AOL?s net margins are expected to swell to more than 30% by 2003. Time Warner?s are expect to improve to 8% from about 1.5% in 1999. Undoubtedly, new synergies will be created as Time Warner?s treasure house of film, audio and video is digitized and piped out to AOL?s growing subscriber base. Any investor who thought AOL?s days as the leading Internet blue chip were numbered had better rethink the Purple People Eater. Bottom Line: At $76.50, AOL shares are a buy. Tell us what you think in AOL's