BancBoston Robertson Stephens Introduces Cash Flow Model for America Online
SAN FRANCISCO, Nov. 16 /PRNewswire/ -- The following is being issued by
BancBoston Robertson Stephens, a member of the National Association of
Securities Dealers, CRD number 41271:
BancBoston Robertson Stephens senior Internet analyst Keith E. Benjamin today
introduced a cash flow model on America Online (NYSE: AOL), rated Strong Buy.
"AOL is now beginning to generate free cash flow, which we expect to be
greater than earnings in F2000, demonstrating the scalability of AOL's
business," said Benjamin. "We believe this will improve AOL's credit rating,
potentially lowering its cost of debt and improving its balance sheet. We are
maintaining our strong buy rating because we believe there is plenty of
potential upside to out estimates and we believe the stock will react
favorably to a cable announcement, which we expect by years end. Our $130
price target is based on 50x our C2001 estimate of $2.60. However, we believe
it is probable the $2.60 will actually be $3.00 or more, which would provide
upside to our target price and put it above the current market price."
Q2 looks great so far in Benjamin's view. Worldwide AOL membership passed the
14 million mark last week, with international membership surpassing 1.7
million. Member adoption of AOL 4.0 has been strong, with more than 5 million
members having downloaded the software. "We expect another solid number above
our estimates," said Benjamin, "but in the near term, I expect the broadband
issue will drive the stock more than will quarterly results."
Based in Dulles, Virginia, America Online is the largest and fastest growing
U.S provider of consumer online information services, with more than 15.5
million subscribers, including CompuServe. Its easy-to-use menu system offers
subscribers a wide variety of services, including interactive magazines and
newspapers, online forums for different special interest groups, email, and
easy access to a host of databases and online communities, including the
Internet.
BancBoston Robertson Stephens is a leading international investment banking
firm focused on emerging growth companies. The firm's 55 senior research
analysts cover over 575 companies. The information contained herein is not a
complete analysis of every material fact respecting any company, industry or
security. Although opinions and estimates expressed herein reflect the
current judgment of BancBoston Robertson Stephens, the information upon which
such opinions and estimates are based is not necessarily updated on a regular
basis; when it is, the date of the change in estimate will be noted. In
addition, opinions and estimates are subject to change without notice. This
Report contains forward-looking statements, which involve risks and
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described in the forward-looking statements. Factors that might cause such a
difference include, but are not limited to, those discussed in "Investment
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finance or other services for some companies described herein and may
occasionally possess material, nonpublic information regarding such companies.
This information is not used in the preparation of the opinions and estimates
herein. While the information contained in this Report and the opinions
contained herein are based on sources believed to be reliable, BancBoston
Robertson Stephens has not independently verified the facts, assumptions and
estimates contained in this Report. Accordingly, no representation or
warranty, express or implied, is made as to, and no reliance should be placed
on, the fairness, accuracy, completeness or correctness of the information and
opinions contained in this Report. BancBoston Robertson Stephens, its
managing directors, its affiliates, and/or its employees may have an interest
in the securities of the issue(s) described and may make purchases or sales
while this report is in circulation. BancBoston Robertson Stephens
International Ltd. is regulated by the Securities and Futures Authority in the
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securities discussed herein are not FDIC insured, are not deposits or other
obligations or guarantees of BankBoston N.A., and are subject to investment
risk, including possible loss of any principal amount invested.
SOURCE BancBoston Robertson Stephens
CO: BancBoston Robertson Stephens; America Online
ST: California, Virginia
IN: FIN MLM
SU:
11/16/98 15:22 EST prnewswire.com |
