Re: UKNM: AOL did well - what value internet stock?

[Nabil Shabka]

chris wrote:

 > At 10:17 11/01/00 -0000, you wrote:

 >

 >  >What can I add? Suffice it to say that, whereas most people have been

 > saying for a long time that Internet stock is overvalued, AOL has

 > demonstrated that in their case at least, valuations have been conservative

 > enough. Of course that does not mean that most internet stock is not

 > over-valued, but it should be borne in mind that real asset value can be

 > bought with funny munny.

 >

 > but the merger is 45%-55% in AOL's favour, even though AOL's market cap was

 > way more than Time Warner's - so the belief in their valuation wasn't total

 > - and 80% of earnings are coming from the Time Warner side, so although the

 > buy-out is phenomenal AOL aren't as monstrous as you make out.


Actually, AOL's offer was at a premium to the market valuation of Time Warner

so, AOL valued Time Warner more than the market.  Which is the normal course of

buyouts/mergers.


 >  >So the moral of the story is - some internet stock may be _undervalued_,

 >  >however much it may appear to be overvalued.

 >  >

 >  >But in my view much internet stock _is_ overvalued, mostly because the

 > company >does not understand well enough how to build real value.

 >

 > Wha?  what the hell are you trying to say?


--

Nabil Shabka

Founder & CEO

BiblioTech

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Fax: 44-20-7384 6981


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