Canaccord Genuity analyst Heath Terry today kicked off coverage of three Internet names, AOL (AOL), comScore (SCOR), and IAC (IACI), with a hold rating on AOL and IAC and a Buy on comScore.

ComScore, he writes, is “in the relatively early stages of adding a significant new business line, ad effectiveness, to its leading audience measurement franchise that should drive significant revenue growth and margin expansion.”

Specifically, Terry sees 37% revenue growth this year and another 27% per annum in the three years following. ComScore’s pro-forma operating, or Ebitda, margin of 22% last year can expand over time to 27% to 32%, he believes, as incremental margin for the company’s services has an 80% gross margin, higher than the company’s average.

IACI, on the other hand, is a “collection of loosely related online” properties that have failed to reap the benefits of network effects and a common platform.

And AOL is facing “headwinds from changing user behavior online [that] will likely prove too much to overcome for the advertising business before its access business loses all subscribers,” he writes.

Terry notes that AOL is losing share in its major properties, with page views in its email service, search offering, its news content and its MapQuest unit all having lost a few percent of market share month by month in the last twelve months. The exception is that email showed improvement in the last year. but Terry doesn’t seem especially encouraged by that bright spot. “AOL continues to experience share loss in email, and remains a distant fourth in the email market in the US.”

Terry does note that AOL’s home page improvements has stemmed some of the decline in overall page views.

As for the company’s $315 million purchase of The Hunffington Post, announced last month, Terry’s not sure it will work: “The Huffington Post’s momentum and content costs may be difficult to maintain within AOL,” and “Culturally, it remains to be seen whether Huffington Post’s liberal culture will clash with AOL’s unbiased approach to news.

AOL shares this afternoon are up 19 cents, almost 1%, at $21.09. ComScore shares are up 65 cents, or 2.4%, at $28.16, and IAC shares are up 19 cents, or 0.6%, at $31.46.

Article courtesy of Tech Trader Daily

Comscore (SCOR) this morning said it has acquired Nedstat, an Amsterdam-based web analytics company, for $36.7 million.
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Article courtesy of BARRONS.com: Tech Trader Daily

ComScore (SCOR) shares are trading higher after the company’s Q2 earnings report this morning.
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Article courtesy of BARRONS.com: Tech Trader Daily

ComScore (SCOR) this afternoon posted better-than-expected Q1 results.
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Article courtesy of BARRONS.com: Tech Trader Daily