AOL First Quarter Earnings Sneak Peek

AOL (NYSE:AOL) will unveil its latest earnings on Wednesday, May 9, 2012. AOL is a global web services company whose business consists of online content, products, and services that it offers to consumers, publishers, and advertisers.

AOL Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 8 cents per share, a decline of 63.6% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 9 cents. Between one and three months ago, the average estimate was unchanged. It has since dropped over the last month. Analysts are projecting profit to rise by 22.2% compared to last year’s 49 cents.

Past Earnings Performance: The company topped forecasts last quarter after being in line with estimates the quarter prior. In the fourth quarter of the last fiscal year, it reported net income of 35 cents per share versus a mean estimate of 17 cents. Two quarters ago, it reported net loss of 7 cents per share.

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Wall St. Revenue Expectations: On average, analysts predict $526.5 million in revenue this quarter, a decline of 4.5% from the year-ago quarter. Analysts are forecasting total revenue of $2.11 billion for the year, a decline of 4.1% from last year’s revenue of $2.2 billion.

Analyst Ratings: Optimism surrounds AOL, as three analysts rate it as a buy, one rates it as a sell, and four rate it as a hold.

A Look Back: In the fourth quarter of the last fiscal year, profit fell 65.6% to $22.8 million (21 cents a share) from $66.2 million (62 cents a share) the year earlier, but exceeded analyst expectations. Revenue fell 6% to $576.8 million from $613.9 million.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of four-straight quarters of revenue decreases. Revenue fell 17% in the first quarter of the last fiscal year, 7.2% in second quarter of the last fiscal year and 5.6% in the third quarter of the last fiscal year and then fell again in the fourth quarter of the last fiscal year of the last fiscal year.

Heading into this earnings season, the company is looking to build on good signs from last quarter. The company reported losses in the second quarter of the last fiscal year and the third quarter of the last fiscal year, but finished in the black with income of $22.8 million in the fourth of the last fiscal year.

Stock Price Performance: Between March 7, 2012 and May 3, 2012, the stock price had risen $7.49 (44%), from $17.03 to $24.52. It saw one of its worst periods between July 22, 2011 and August 2, 2011 when shares fell for eight straight days, dropping 15.9% (-$3.08) over that span. The stock price saw one of its best stretches over the last year between February 7, 2012 and February 16, 2012, when shares rose for eight straight days, increasing 5.6% (+$1) over that span.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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