AOL Third Quarter Earnings Sneak Peek

AOL (NYSE:AOL) will unveil its latest earnings on Wednesday, November 2, 2011. 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 net loss of 7 cents per share, a swing from profit of 79 cents in the year earlier quarter. During the past three months, the average estimate has moved down from 16 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at a loss of 7 cents during the last month. For the year, analysts are projecting net income of 5 cents per share, a decline of 98.5% from last year.

Past Earnings Performance: The company missed estimates last quarter after beating forecasts in the prior two. In the second quarter, the company reported a loss of 4 cents per share versus a mean estimate of profit of one cent per share. In the first quarter, the company beat estimates by 2 cents.

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Wall St. Revenue Expectations: Analysts are projecting a decline of 7% in revenue from the year-earlier quarter to $524 million.

Analyst Ratings: seven out of 12 analysts surveyed (58.3%) have a buy rating on AOL.. This is below the mean analyst rating of nine competitors, which average 68.9% buy ratings.

A Look Back: In the second quarter, the company’s loss narrowed to a loss of $11.8 million (11 cents a share) from a loss of $1.05 billion ($9.89) a year earlier, but missed analyst expectations. Revenue fell 7.2% to $542.2 million from $584.1 million.

Key Stats:

Revenue has fallen in the past four quarters. Revenue declined 17% in the first quarter from the year earlier, dropped 24.2% in fourth quarter of the last fiscal year from the year-ago quarter and 27.4% in the third quarter of the last fiscal year.

AOL’s loss in the latest quarter followed profits in the previous three quarters. The company reported a profit of $4.7 million in the first quarter, a profit of $66.2 million in the fourth of the last fiscal year and a profit of $171.6 million in the third quarter of the last fiscal year.

Competitors to Watch: Google Inc. (NASDAQ:GOOG), Yahoo! Inc. (NASDAQ:YHOO), Microsoft Corporation (NASDAQ:MSFT), IAC/InterActiveCorp (NASDAQ:IACI), Demand Media Inc (NYSE:DMD), News Corporation (NASDAQ:NWSA), The New York Times Company (NYSE:NYT), CBS Corporation (NYSE:CBS), and, Inc. (NASDAQ:BIDU).

Stock Price Performance: During September 29, 2011 to October 27, 2011, the stock price had risen $2.37 (19.3%) from $12.27 to $14.64. The stock price saw one of its best stretches over the last year between August 22, 2011 and August 31, 2011 when shares rose for eight-straight days, rising 27.5% (+$3.36) over that span. It saw one of its worst periods between July 22, 2011 and August 2, 2011 when shares fell for eight-straight days, falling 15.9% (-$3.08) over that span. Shares are down $9.07 (-38.3%) year to date.

(Source: Xignite Financials)

Investing Insights: Here’s Why Chipotle’s Stock Keeps Winning.