IBD, Monday, Oct 20: Cheap Computers Change The Consumer PC Picture
investors.com
Summary:
ú On Tuesday, Paul Otellini, Intel's vice president for sales and marketing told a group of analysts, "We have repositioned our product line to participate in this growth area.
ú Compaq's consumer PC sales increased 111% in the third quarter.
ú Compaq holds 72% of sub-$1,000 market; Packard Bell NEC is second with 16%.
ú Some feel that both consumers and commercial PC buyers are realizing that they don't need to move up to more powerful systems as rapidly as they did before.
ú Most companies bought 133-MHz and 166-MHz in March; 166-MHz and 200-MHz in October.
ú On Monday, DEC will announce two new machines that are under %1,000 and are specifically designed for the corporate market: $899 166-MHz K6 machine with 1.2 GB HD and 16 MB RAM; 14-in monitor is $100 extra. Second machine is $969 Intel 166-MHz MMX without monitor.
IMHO:
ú Compaq will have a very good fourth quarter, but they may find most of their consumer sales loaded into the third and fourth quarters in the future
ú DEC will not sell many bare-bones systems-they are practically unusable as configured-but they will increase expectations of lower cost systems
ú CPQ and DELL stock prices will be under pressure Monday, and maybe longer, because of DEC's announcement
ú Compaq and Dell will respond with lower cost options for the corporate market
ú PC box stocks will be oversold by the end of next week |
