Jack -
I tend to agree that if CPQ started showing big earnings from its stock portfolio as opposed to core business, that would not bring the stock price up rapidly - but the notion that they will dribble this out over 10 years also seems far fetched. Taking just a small portion of the more than $8B in investments that CPQ currently holds, say enough to start moving earnings up by .10, then .15, would put us at the high end of the EPS estimates at $1.50 or $1.60 for 2000, even if the core business does only $1.00 or so. That's got to be good - it's real money after all. CPQ can hardly represent itself as a holding company but they have done a good job of investing, and IMHO have made MUCH better use of their cash than DELL, which has invested timidly except in DELL's own stock, which of course can not contribute to earnings as those are treasury transactions.
Intelligent management of that portfolio has got to be something the street will take notice of, sooner or later. |
