AOL Inc. (AOL), the New York-based Web portal saw its biggest gain since May after reporting its Q2 revenue and profit per share that topped analyst’s expectation. The company’s share rose 5.82% by 12:12 PM. AOL reported a net income of $907.8 million, or $10.17 a share, compared with a loss of $11.8 million, or 11 cents a share a year earlier. The revenue still show a decline of 2% but this figure is the company’s best mark in seven year. Besides that, a $1.1 billion patent deal with Microsoft Corp added a great aid to the company’s balance sheet to score its easy profit in the second quarter.
AOL hit a new 52-week high as its is currently trading at $29.07, 10 cents above its previous 52-week high of $28.97 with high volume this morning.
The company also said that revenue from display ads grew better than originally expected. Total advertising improved 5.9 percent to $337.8 million. AOL’s U.S. advertising revenue ranks fifth among major competitors behind Google (GOOG), Yahoo (YHOO), Facebook (FB), and Microsoft Corp. (MSFT) according to Bloomberg data. CEO Tim Armstrong stated that from now on the company will focus its resources on high-growth areas like video and mobile, and on a sales approach that emphasize data and industry-specific pitches.
Among one of the best looking chart this year, AOL held up strong after its wide bullish gap in early April. Rather than falling back into the gap, AOL put in a series of higher highs and higher lows showing a healthy consolidation after a big gain. With the key moving averages rising up, AOL is approaching its previous high of $29.45 from April 2010 on the weekly chart. Taking out this pivot high is just a matter of time if this Internet company continue to stay above its 50-Day moving average. Support 1 comes in at $27.90. Support 2 is in line with the 50-Day moving average around 27.40. Overall, AOL’s chart look healthy and poised for a move higher.
By Vanessa Han
Disclosure: Author has no relevant positions