micheal..i know compaq like the back of my hand. I'm not insider anymore so the info. is legal.
First of all, I like HP too. As the Information System mgr at cpq. I invented ways for cpq to run off of HP's 3000's when they said it was impossible to run a 500mm company off of the 3000. Back in 1984 when you logged 50 poeple on a 3000 it would shut down. But, the CFO said
I had to keep them on 3000's . I did and they still are.
Answer 1. You said that cpq's could quite selling in one question and
in another question you said they can't deliver on time. It's alittle
hard to be both of these.
Let me assure you Cpq knows demand and has a quality and JIT system that is state of the art. Better than the japanese dream about becasue it encompasses the business side too..not just manufaturing.
They have a world wide planning system that regenerates their plans in seconds. They have a channel inventory/demand system that gages ins and outs from dealers. They are moving the channel inventory system into their world wide planning system now.
Your jan puts can pay off if they are jan 55's..so hold in there.
I'm not positive on it. We need a market tank for them to win.
Now, a spring 60 or 55 could win.
I can assure you that all your logic is faulty on this one.
The real issue is cpq has got to pull off the re-eng projects. If they do then cpq is a dynasty and pfief is right they will be the biggest computer company in the world. If they don't then cpq has we know it is a goner. It will still be here but it is going to be rough.
Just extrapolate out the revuenue numbers I gave you and see if pfieif's statement can catch the 60-80b companies ahead of them.
Of course their profit is even better..that's why the execs were able to leave. profit raises stk price.
answer 2 I've been there. Cpq is an honest with analsyt as any compnay could be. In fact they err on the negative side. That is why I was positive they would see and issue caution this last 3q earnings, but they didn't so let me assure you that the numbers say go. They aren't god's..what they and the street do not see is that the economy may tank for a feww months.
answer 3. cpq has always had this rough competition. And, when things look this bad the stock has always tanked. The street has always said Cpq's in big trouble lets sell. Accept for the 1990-92 era when cpq should have started the low cost pc war and didn't. the analsyt were wrong to sell. This time they are simply saying that cpq will meet and win on the challange becasue they have in the past..everytime.
answer 4. HP wouldn't agree with your "HP is already the company that cpq dreams of being. When at cpq I must have let 100's of HP exec's do a plant tour of the systems at CPQ. HP wanted to duplicate them so bad that it was killing them. By the way Compaq has a profit per employee
that would drawf HP. Although HP has improved drastically in this area. So, you will not get HP to agree with your statement.
answer 5. The re-eng projects have put unreal pressure on people and exec's at cpq. This pressure is in addition to being the fastest growing company is history.I'll call out the numbers by year
111mm,329mm,503mm,629mm, 1.2b, 2.1b,2.9b,3.6b,3.3b,3.?b,7b,11b,15b
Growth like this w/o acqusitions is rough on the body. Then to top it off they have massive re-engineering projects going. Projects that will allow them revolutionary cost and cycle time drops.
If you were in the cooker and you had 50 million or 10million or 5 million worth of cpq stk...would you stay???. Keep in mind that the avg manager at cpq if he didn't sell their stock now has 7 million worth of stock. and that's if he didn't put his 401k in stock.
some of the exec leaving have 50 million worth. They have just decided that's enough. I want a job for a normal human being. I'm not guessing here. I'm close freinds with some of these that leave.
I hope this helps...that's all Im trying to do. provide info that helps your investing. If I've been wrong in my cpq calls the last 2 months during this run up , I would like to know it.
good luck |
