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Technology Stocks : Compaq
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To: NoPainNoGain who wrote (21587)3/12/1998 4:12:00 PM
From: van wang  Read Replies (1) of 97611
 
CPQ fell down and can't get up...they way CPQ is trading its inevitable on a down day, CPQ is going to let go 1+...shorts are going to be happy...and they have alot going:

1) inventory initiated by CPQ accounting methods on overhead allocation and subsequently caused a glut in the higher end models due to cannabilization and incorrect pricing

2) Build to order model...let me see.. they are trying to copy DELL (who btw has been doing this for quite awhile and has already ascended the working capital mgmt curve) with resellers/distributors and not with their own facillities...recipe for disaster in the near term

3) DEC/CPQ/TDM integration....time to kill, anyone?

I have a short on and will short more if through a miracle CPQ trades up to 26 again...miracles do happen since my short was executed the other day at 26 7/8

but dont worry DELL is going down too...you cant be sheltered when the no. 1 player decides to hit the bid on inventory...also heard from my friend that his employer bought quite a number of business model desktops because CPQ was having a special price...he said it was a very good deal and the company decided to go with CPQ rather than DELL...I have a short on DELL too $65++...and will continue to add to position if DELL trades higher

cheers...go short and make some money in the near term
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