Barclays More Positive on AOL, Inc. (AOL); Raising PT and Estimates After Another Strong Quarter

May 10, 2012 2:43 PM EDT
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Barclays maintains an 'Equalweight' on AOL, Inc. (NYSE: AOL) price target raised from $27 to $31.

Analyst, Anthony DiClemente, said, "AOL reported strong 1Q12 results ahead of the Street on the top and bottom lines. Management raised FY2012 EBITDA guidance 13% from $310M to $350M as the business continues to improve, and for the first time management said it would return 100% of patent sale proceeds to shareholders (up from prior "most")...As a result, we believe AOL now presents an attractive short-term buying opportunity."

Diclemente is also positive as fundamental business trends continue to improve, with it's fourth straight quarter of global ad growth. Churn was at a seven year low. But, there are still some concerns with overspending, despite M&A not currently being a focus ($ from sale of patents being returned to shareholders). Although, this return of capital is currently underappreciated, in DiClemente's view."

Barclays raises FY12 EPS estimate from $1.04 to $1.38 and FY13 from $1.27 to $1.48.

For an analyst ratings summary and ratings history on AOL, Inc. click here. For more ratings news on AOL, Inc. click here.

Shares of AOL, Inc. closed at $26.47 yesterday.

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