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I had built up a good basis in CPQ in 1995 at an average (split adjusted) of 8.24, in late 1996 I bought more at 14.4 (72 at the time) my friends thought I was insane, 'stock is at an all time high, PE out of line, Tandem acquisition will kill the company' etc. That buy looks pretty good at the moment. I recently added more at 28, got pretty much the same comments from my peanut gallery, and that buy at 28 is currently seriously underwater, but I am confident that a year from now I'll feel the same way about it as I do the 96 buy... if CPQ drops below 22 I'll add more. When I go back a year or two and look at the bearish comments on CPQ thread (or Dell which I also hold) at almost any time in the last few years, I see the same sentiment as I see today. I doubt that I will pick the absolute low on either stock, I never do, but I don't think that matters much long term. I think CPQ is a much better buy at the moment than Dell due to current market conditions, CPQ has taken the hit while Dell bulls are still in denial. Conditions for an upward breakout in either stock may not materialize until midyear or maybe even 3Q, but it could happen at any time. I would cautiously add Dell if it dropped to the mid-50's, CPQ on any dip at these levels. |
