Compaq Message Board - Msg: 378806

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Technology Stocks : Compaq

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To: JPM who wrote (333)	10/22/1996 7:32:00 PM
From: hpeace	of 97611

jpm..mb is the professional investor. I just happen to know more about cpq than anybody. I also am in cpq's and the memory supplier chain so I have some good insight that a normal person could not get. My recco on a naked call on cpq is NO!!!!. There is great chance of it going to 85. Joe posted an excellent case for the chance of this... BUt, I don't recco naked positions. You wouldn't beleive the mfg cost on a cpq pc so I want say... But, they are in the low cost provider tier... I didn't say the lowest but in that tier. Their re-eng projects which they are spending $100mm over 5 yrs will keep them a dynasty if they are successful. It will propel them to the largest revenue and profit computer company in the world.....boy...if people read this post I'm going to get alot of hate mail. As I have mentioned...Cpq reported earning that were out of sight.... but , they were called in and congratulated, then everybody clapped, then they were told that they stink on getting the re-eng project completed. The atmosphere in some groups are a "do or die" kind of environment. There is only one other time that cpq had this kind of pressure and that was the low cost pc project that revolutionized pc prices. They are not sitting back and congratulating every other and doing high fives.... They are executing to a "do or die" plan.. I'm betting they kick a--.....but I will not recco naked calls. I was able to prodict the 75+ hiccup in cpq, but I don't know from here. The interesting corollary is during the pc low pc challenge cpq had a hiccup in earings... now the earnigs look like they would be kicking up their heels and relaxing....but that is the opposite of what is happening. It's this kind of knowledge about what is happening at cpq that MB leaves out of his numbers. When I get a feel for cpq's next move I'll blab it. One of my post right before earnings release was a 1/3 put position at 75+. This is what someone would do if they didn't want to miss no matter what. But, my position is let it go to 85. if it does that I put... otherwise forget it ..who cares. To miss it doesn't mean anything. chance will come along again. It's called a safety play. learned it from the tournement Bridge I played for decades against the best people in the world.

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