Every company advertises on AOL. AOL advertising revernue is much much more than that of YHOO. Plus subscription fee from membership like me who pays 21.95 each month, AOL has great earning report. AOL earning growth more than 150% quarter after quarter.
Short sellers manipulated AOL down to current bargain price. But AOL fundamental has not changed. AOL fundamental is still very strong.
It is best time to buy AOL at bargain now before institutional investors, bargain hunters rash to buy and AOL jumps big soon.
HERE ARE REASONS WHY AOL GO UP FROM CURRENT LOW FROM WELL RESPECTED JOURNALIST:
By Rick Aristotle Munarriz (TMF Edible)
As for America Online, it got the "You've Gotta Bail!" treatment in Barron's over the weekend. A hedge fund manager wasn't exactly impressed with insiders selling four million shares recently. Keep in mind, the company has more than a billion shares outstanding. Still, what fun would a short covering rally be without shorts.
The manager, Seabreeze Partners' Doug Kass, feels the stock could lose half its value as the company faces pricing pressure in the future from charitable upstarts. Let's put this into perspective. Even if AOL were to tumble below $50, that would only be taking the stock back to where it was in December. If Kass were to project a single-digit share price for AOL that would only take it back another year. Hey, AOL is volatile, even with what many figured would be S&P 500 stability this year. But what are the odds of AOL doubling over the year ahead and Kass making the same argument? Implying today's price is a fair price?
Anyway, the whole "free Internet" argument as a death knell for AOL baffles me. AOL was never the cheapest as it ran circles around the competition. This wasn't the service of choice for 20 million bargain-hunters. It was simply the best. Unique immediate content that inspired unique immediate community is not something an aspiring ISP can provide.
The real kicker here is that someone concerned with AOL's pricing structure would bring up the free access revolution in the first place. What is subsidizing fee-free online connections? Advertising. Doesn't that vindicate AOL's business model? Sure, AOL's next price move might be lower rather than higher, but if that continues to add subscribers is advertising going to suffer? AOL announced this morning that 900,000 newbies will join up this quarter. Profit projections of $0.13 a share are in line with the analysts. Only a third of the domestic Internet market has been tapped and the world is full of virgin topsoil.
Is America offline? No. Are the multi-million dollar sponsorship deals showing any hint of hooking up with abatement? No. So, what's the worry here? Nobody really owns the water. Let the world sample the free water fountains. They will still thirst for Coke. Let them delight at finding free television weeklies bundled in the local Sunday papers. They will still thumb through TV Guide.
Besides, am I the only one who sees the fallacy in these government cheese ISPs? They are relying on ad space to offset access costs. Now, ask yourself this: if you had a product to sell and had a finite supply of ad dollars, where would you turn? Would you go with AOL or would you go where the demographics have been weaned off disposable income to the point where $20 for convenient monthly access is passed over?
I've never seen a billboard on a water fountain, and I say that with some degree of authority. After all, my son almost inherited the water....!!