NEW YORK (TheStreet) -- AOL (AOL) rose 3.86 % to $43.88 at 1:29 p.m. on Wednesday after the company unveiled its plan for ONE, aglobal programmatic advertising platform for brands, agencies and publishers.
AOL Chairman and CEO Tim Armstrong and AOL Platforms CEO Bob Lord unveiled the idea during a keynote presentation at ad:tech San Francisco 2014. The two revealed their vision of advertising's future as an open place where all parties benefit from a platform-driven industry.
Global CEO of IPG Mediabrands Matt Seiler joined the two AOL executives on stage to announce the company's plans to act as the charter agency network partner for ONE as it pursues its commitment to fully automating half of its media investments by 2016.
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TheStreet Ratings team rates AOL INC as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate AOL INC (AOL) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 26.23% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, AOL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- Despite its growing revenue, the company underperformed as compared with the industry average of 16.4%. Since the same quarter one year prior, revenues rose by 13.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Although AOL's debt-to-equity ratio of 0.05 is very low, it is currently higher than that of the industry average. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.27, which illustrates the ability to avoid short-term cash problems.
- Net operating cash flow has increased to $90.00 million or 17.34% when compared to the same quarter last year. In addition, AOL INC has also modestly surpassed the industry average cash flow growth rate of 12.00%.
- You can view the full analysis from the report here: AOL Ratings Report
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.