It’s been a little while and I’ve certainly missed it. Today, I’m starting off by closing 2 trades done earlier in the year. First off,

Long Google (GOOG) & Short Valueclick (VCLK): +24,79%

Long AOL (AOL) & Short Demand Media (DMD) -26,66%

Today, I am opening a new trade that involves 2 stocks trading at comparable forward P/E ratios. Yes, AOL has been a difficult name for me to trade and it has done incredibly well in the past 18 months or so. But if you look at fundamentals, I don’t think you could possibly compare these 2 stocks. Just take a look at their recent growth profiles:

AOL Revenue Quarterly YoY Growth data by YCharts

You can also take a look at the numbers for both stocks:

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Long Priceline (PCLN)

Priceline has been one of my favorite stocks for years. It seems to always be underestimated. Why? Perhaps because it’s a fairly big name but makes little noise. It’s also evolving in a fairly competitive industry. It has remained a solid player though and I do think the recent acquisition of Kayak will turn out to be key for Priceline’s long term future. If growth keeps up as most analysts expect, I don’t think its current price is exaggerated.

Short AOL (AOL)

AOL was a star last year and continues to do fairly well in 2013. Part of it is due to solid execution by the Tim Armstrong team but it’s also due to some one time moves such as the patents sale. In the end, it’s difficult for earnings to increase quickly when sales are no, especially in the ultra competitive content business where AOL competes with the likes of Demand Media (DMD), Yahoo (YHOO), IAC Interactive (IACI), etc