NW,
Depends on general market conditions, and more evidence of what is really happening in Q-1. I for one don't buy the interest rate hike hype, that has become one of the biggest distractions in the market. The market will apply whatever spin it wants on Greenspan's ambiguity, in the case the market needed to blow off some steam after a great post-October run. So this would normally make Compaq a buy.
Of course, a much more sinister concern is weakness in Q-1, a possible repeat of Q-4 channel-stuffing. If these fears are unfounded, then we will soon have our opportunity.
I find the Dell thread and some of its participants will give you a good sense of whether these PC concerns are valid or not. I would say the jury is still out with a cautious bias to no major 1999 slowdown. If true, this has not yet been embraced by "conventional wisdom" which means Compaq and Dell aren't going anywhere soon.
In my mind, you can't establish a price target, because markets and sentiment change too rapidly. I prefer to be a little late, rather than too early, and I think we're too early.
Gene |
