Dr. GTW news is real quiet right now. I smell bad news though. I have to wonder why Tedd wants to open a Corp.Office in S.Cal. I think it is two things. One......he likes La Jolla and built a house there. Two.......he can't get enough good tech people to move to cow land. I live here, but then I actually enjoy the smell of the country.
I think he has decided that he is in this business for the long haul, and is prepared to go the long road. I think he and his family all know that the likelihood of exponential growth in the coming year is not very good. Face it, DELL has beaten them to the direct model that they had in their hands at one point, and now have let slip away to some degree. I mean, DELL has taken that marketing niche and run with it. GTW got off track with Destination, and struggles to catch DELL. They never will. All "hip" computer buyers now want DELL. Its cool to own a DELL. So, he will spend time in S.Cal and enjoy his life and money. I wish I could move to La Jolla for the summer.
I think the reason he needs COW stores, is that no one wants to purchase a PC/TV Destination with out looking at it first. Is this not a reversal from the direct model???
He will surround himself with some new, smart tech people in S.Cal and regroup. He knows that he must find the future "next generation" stuff before the other box makers do, or he is history. His people are selling some of their stock to hedge their bets.
If PCs continue their downward price spiral & chips like (NSM) is introducing help the slide, look out. I'm not saying that GTW will not sell more PCs because of increased demand due to coast reductions, just that 5% of $800 dollars is only $40 dollars. In the good old days 5% of $2500 made him rich.
So, If you want me to tell you what I think you should do......Then here it is. Sell GTW tomorrow and purchase an equal amount of DELL. If you insist on investing in a box maker, go to DELL. Stop fighting it. Close your eyes, and just do it. If GTW comes in at street estimates, the price may go to $52. If they come in short, it may go to $32. My feelings are that the downside is much more risky that any upside gain. If it goes down, it will stay down until x-mas.
I put my $ in LU and am swimming in paper profit. I will buy more tomorrow if I can get in at the closing price. Hey, PCs are not it right now. Its networking that is the next wave. Actually both, but I feel networking has much more margin in it right now. DWW II |
