Henry Blodget Likely Quotations

Near-term, in a market environment in which investors are fleeing to quality, its stock could continue to do well. Our analysis, however, suggests that the company's long-term earnings growth is likely to be slower than the 15 percent to 20 percent consensus.

Settlement talks, if any, will likely be very complex, with multiple parties involved.

We have received a number of calls on whether a combination of Yahoo and Disney would make sense. We believe an investment would be much more likely. Given that AOL-Time Warner is likely to be a real entity within a few weeks, creating a very strong global integrated media and Internet competitor, we believe other media companies will be looking to create similarly powerful internet strategies.

We still believe that, over the intermediate term, these factors will likely outweigh controversy surrounding Windows XP, so we maintain our 'accumulate' rating.

A settlement as broadly described would represent a positive for the company and stock. Importantly, however, the states have reportedly not yet signed off on such a settlement, and without their support, the case will likely still head back to the district court.

After that point, it is likely that the case could be appealed to the Supreme Court, which could add at least another six months to the outcome. So the case may not conclude until 2003.