Inc (PCLN), AOL, Inc. (AOL), IAC/InterActiveCorp (IACI): What You Want in an Internet Investment

IAC/InterActiveCorp (NASDAQ:IACI) prospered through the last decade, and its peak year was 2008, when shares sold for about $80/each. They’re presently down to $50, but they have been rising steadily since the $16.60 bottom achieved in late 2008. If you bought IACI when it first went public in 1996 you’ve had a wild ride, but you’re still 19 times better off than you were.

IAC/InterActiveCorp (NASDAQ:IACI), on its own, has nearly doubled its revenue over the last three years, from just under $1.5 billion/year to the present level of $3 billion. So far in 2013 it’s drawn over $100 million in profits on over $1.5 billion in revenue. Those are narrow margins, but sales growth is real.

The company’s current portfolio includes match-making sites like, search sites like and DailyBeast, a clone of HuffPo. That doesn’t sound especially strong, but if you were a long-term holder of IAC/InterActiveCorp (NASDAQ:IACI) you also got a piece of the (EXPE) spin-off in 2005, and if you held onto that you also got a taste of its 2011 spin-off of Trip Advisor (TRIP). That’s five times the equity that IACI itself holds today.

In other words, if you’re in business with IAC/InterActiveCorp (NASDAQ:IACI) founder Barry Diller, you’re making money.

Foolish Conclusion

When looking at any Internet investment, look for transactions or database exclusivity. This is what Inc (NASDAQ:PCLN) and IACI have, and both remain buys at present levels. This is not what AOL, Inc. (NYSE:AOL) has, and if you’re stuck with it, sell.

Dana Blankenhorn has no position in any stocks mentioned. The Motley Fool recommends The Motley Fool owns shares of article What You Want in an Internet Investment originally appeared on and is written by Dana BlankenhornCopyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.