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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: S. maltophilia who wrote (5655)	11/7/1997 1:04:00 PM
From: Tim Kenney	Read Replies (2) \| Respond to of 13594

>I haven't seen the 10Q for this quarter yet, so maybe someone can enlighten us: When and where were the ~18 million shares issued? What money resulted from their issuance?< AOL generously rewards its officers with stock options (even Sam may get a dribble). This, of course, is not properly accounted for on their financial statement. (But, then again, no one does.) This serves to overstate earnings and make Stevie want to very badly to keep the stock price going up so he can mine the gold in them there options. However, although the cost of the options are not properly deducted from company earnings, they do show up in the number of shares used to calculate a fully diluted EPS number.

To: S. maltophilia who wrote (5655)	11/7/1997 10:06:00 PM
From: Art Stone	Read Replies (2) \| Respond to of 13594

On AOL's 10K they stated there were 100.7 million shares outstanding. From newest release:Earnings (loss) per share $ 0.16 Weighted average shares outstanding 118,880 At the risk of answering a question answered already, when computing EPS, the accountants insist that you take all options, warrants, preferred stock, etc... which might Dilute future earnings (if exercised), and present the EPS number based on a worse case scenario. AOL has a huge number of Director / Officer stock options going down below $10/share, and I believe Sprint is still holding a large chunk of warrants which they can exercise for something like $13/share. That's my guess.