I don't think Dell will move up significantly until after mid-July. People are going to want to see what earnings actually are. Note carefully in Compaq's press release that it was not planning TODAY to preannounce earnings. Although Compaq said that earnings are good, are they as good as investors are expecting? Good just means not bad; it doesn't mean great. I believe that both Compaq and Gateway are indicating exactly this, that earnings will be all right, and that they will certainly not be great. Also, Intel's chip price reductions are not going to help computer companies' profit this quarter. Dell won't rise above 115 and change until after mid-July until investors get a chance to look at actual numbers. The way that Compaq and Gateway worded their statements about earnings this quarter is casting enough doubt in investors' minds that they will wait to see what earnings actually are, and if people stop buying, the price goes down. Needless to say, the Fed meeting on July 2 will also create jitters. Considering that Intel is a BIG company, if their earnings are weak, there's got to be more than just MUEI that is suffering, and it can't be AMD and Cyrix because their production isn't really ramped up yet.
As far as the chip makers go, I think AMD and Cyrix will still do well. Even though Intel is certainly closing the price gap, AMD and Cyrix still have better chips; they have better performance, and as I said earlier, I don't think most people care what processor is inside. |
