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To: jhg_in_kc who wrote (236)	3/28/1999 6:14:00 PM
From: Chuzzlewit	Respond to of 419

jhg, I haven't even gotten to the issue of valuation. I am as confused as most about this issue-- perhaps more than most. I do see a couple of seminal principles. First, where barriers to entry are low for e-tailers, competition will remain high. The implication for companies like the portals and AOL is the potential of a considerable amount of incremental advertising revenues. In a much earlier post on the Buffetology thread you will recall that I pointed to the comparison of AOL to an electronic shopping mall. The combination of the increasing stream of advertising revenues and mall sales bodes well for AOL. But that does not mean that the stock must move higher over the very long term. What should AOL be worth? I asked several posters on this thread to go through the exercise of imagining AOL as a mature company with its current market capitalization. Then I rhetorically asked the question, "What would the cash flows need to be to justify today's valuation, and how long do you think it will take to get there?" Are investors harboring expectations that can not possibly be met? Perhaps you would take a crack at answering the question. I hope you are feeling better. TTFN, CTC