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Technology Stocks : Compaq

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To: hlpinout who wrote (50937)3/2/1999 7:07:00 AM
From: rupert1  Read Replies (1) of 97611
 
Hio: I do agree that CPQ's PR - in the larger sense - doesn't compare with DELL's.

The most damaging interpretation of the "leak" is that (a) CPQ knew some materially negative information which it held back from analysts who had previously enquired and from shareholders (b) that it then released the information to favoured shareholders/analysts and (c) that some of the latter took advantage of the information on Thursday.

I do not think any of the above is true. But it doesn't matter what I believe - it is bad karma for the company and its share price.

A Michael Dell would now limit the damage. But I think it might be dangerous for a company as clumsy with PR as CPQ to try to limit the damage. If sales for the quarter turn out to be poor, its damage limitation exercise could, itself, be seen as market manipulation. Also, doubts would still remain until actual results are in.

But despite the hurt feelings of some analysts and public they will jump back on the bandwagon if they think the stock price is a bargain - which it is.
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