Now that it finally has merged with Time Warner, it may no longer be appropriate to consider America Online an Internet company.
But with more than 24 million subscribers worldwide, AOL-Time Warner clearly is a huge online presence, and a business arrangement with the company can be a big boost for other Internet players.
The latest to snag a major deal with AOL is Portal Software , which announced on Monday a multimillion-dollar, multi-year contract under which the online access giant will use Portal’s Infranet business management and billing software for a number of services.
Specific terms weren’t disclosed, but it is the second notable customer win for PRSF in the past week. The company last Wednesday announced that voice portal and infrastructure market leader Tellme Networks will use its Infranet software.
Even though terms of that deal also were not disclosed, the news sent PRSF shares soaring 38% to close Wednesday at $11.75.
Barring the possible influence of larger market forces, look for Portal to get another good ticker ride on Monday as investors both react to the AOL contract and take a closer look at the company, whose stock remains nearer its 52-week low of $4.75 per share than its high of $86.
If profitability is the first criteria for investors these days, Portal makes the initial cut. The company has turned in four consecutive quarters of increasing profits, beating Wall Street estimates for Q3 with a net income of $7 million, or 4 cents per share.
However, shares nosedived in November after several analysts downgraded Portal, citing concerns that reduced spending by dot.com customers would slow sales.
The AOL and Tellme deals could go a long way toward easing those fears and restoring investor confidence in PRSF, which is currently valued at 8.1x trailing 12 months’ revenue of $226.2 million.
Another Prediction Gone Awry
Congratulations to you Baltimore fans who wrote in after I predicted a 13-10 Super Bowl win for the Giants. The Ravens put a real whupping on New York. For us Giants fans, it was like buying CMGI a year ago.
