Compaq Message Board - Msg: 4183925

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Technology Stocks : Compaq

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To: Jimbo Cobb who wrote (24877)	4/23/1998 6:18:00 PM
From: robbie	Read Replies (1) of 97611

Notes from today's meeting from the Yahoo CPQ thread: <- Previous Next -> Message 22170 of 22198 Reply Notes from the annual meeting hobiecat_97 Apr 23 1998 3:10PM EDT Yes, I attended the annual meeting. I only live about 12 miles from CPQs headquarters so I took in the event. I own quite a few stocks but this is the first annual meeting Ive ever attended. It was defintely worth my time. I'll include some notes on what interested me and will be happy to answer questions to the best of my ability. I might add that I missed the first few minutes. It was very crowded and I add trouble finding a seat. Now for the good stuff: Management reported that they have 7 billion cash on had. This compares to 6.76 billion in 97 4.08 billion in 96 only 863 million in 95 and 586 million in 94. They are spending 100 million for our dividends. Digital will cost 4.8 billion. They announced the stock repurchase aggreement for up to 100 million shares with a final cost unknown I think they said that this is only the 2nd time they have had a repurchase but I could be wrong about that. They did say that the last time they bought stock it cost them an average of only 2 dollars a share adjusted for all the splits since then. They implied that they thought buying the stock was a good deal at this time. Regarding inventories and the new channel model: They stated that inventories were reduced the first quarter but they still had work to do in this area. They implied or actually stated (Im not sure which) that the 2nd quarters EPS would be still impacted by the ongoing inventory reduction. I believe Eckhard stated they had reduced inventories by 300 million. I was surprised to learn that the first quarters consumer markets in North America were very strong. Up 82% on unit basis up 42% on revenues with a gross margin of 45%. Overall sales were up 23% Unit growth 43%. North America up 26% overall. Europe up 22% but 33% in local currency. Asia pacific up 5% flat in the fourth quarter (I guess these figures are for all of 97). Latin America up 44% and Japan up 3%. Now most of their sales are in NA and Europe. They really just have a small Asian prescene relatively speaking. Regarding the question and answer session: Most of the questions were disappointing in their relevance. Some of them were angry, challenging or rude in nature. Yes, the stock is down temporarily but its about 75% higher than this time last year. What do people expect? For example someone asked why CPQ spent 5 million to have the Houston Rockets stadium named the Compaq center. The answer is to advertise the Compaq name to end users. Another very angry black minister raged about the lack of an African-American on the board. Management stated that they tried to represent the best interests of the stockholders in selecting board members. Several people just told Eckhard how angry they were about the stock price. One good questioner asked why they couldnt duplicate Dell and achieve its more favorable pe. Eckhard stated that they couldn't just abandon their distribution model and end business relationships that they have had for years that this would wreck the company. I also gathered that they feel Dell will eventually be trapped by their model and that the recent Acquistion of Tandem and Digital are designed to make CPQ a full service company. Overall I left the meeting feeling real positive about my investment. I think they have temporarily been hammered down by the costs of the change to their new inventory readjustment and the acquistion of Digital and Tandems. I think the next quarter or twos eps will disappoint but then I think were taking the elevator up. It seems like now is the time to buy while the stock is depressed Hope this helped. ÿ CPQ:ÿ Quote ÿ\|ÿ Profile ÿ\|ÿResearch This Is a Reply to: Msg 22151 by Peter_Mau View Replies to this Message <- Previous Next -> Message 22170 of 22198 Reply ÿÿ -------------------------------------------------------------------------------- Go to: Startÿ\|ÿMost Recentÿ\|ÿMessage List \| Message Number:ÿ ÿ ÿ All Boards ÿ Only in this Board ÿ All ÿÿ Boards & Topics ÿ Authors -------------------------------------------------------------------------------- Terms and Conditions Yahoo! is a trademark of Yahoo! Inc. Copyright c 1994-98 Yahoo! All Rights Reserved.

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