Compaq Message Board - Msg: 2460300

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Technology Stocks : Compaq

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To: D. Swiss who wrote (6734)	10/16/1997 4:48:00 AM
From: D. Swiss	of 97611

TechM, maybe I am a little too optimistic. Lets look at it another way. If a 42% unit sales growth in q2 translated into a 25% revenue growth, then a 70% (conservative) unit growth rate in q3 would translate into a 42% revenue growth rate in q3. If we also assume net margins will accelerate at the same pace they did between q1 and q2, they will be 8.7%. However, if they increase at the pace they did in '96 q2 to q3, the net margins would be 9.8%. This would produce an EPS range of .78 to .88, assuming 711 million shares outstanding (but remember there is a buyback program in effect). A more conservative case scenario is .75 if net margins stay flat. Oh well, we will find out shortly. :o) Drew

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