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Technology Stocks : EDS - Recent pullback a buy opportunity???
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To: NICVIC who wrote (1090)7/30/1998 10:36:00 PM
From: Dave O.  Read Replies (1) of 1841
 
< I could understand the analysts perhaps being a bit cautious due to the GM strike impact in the third quarter, but this has nothing to do with any EDS blundering. >

I think there will be longer term ramifications. A while back I posted about GM hinting they might start cutting certain vehicles (Camaro/Firebird for example). If GM pursues this then it means less GM engineers, designers, ..... Consequently it means less support required from EDS for any groups that disappear over time. I don't see GM as a growing company, rather I think they will continue to shrink personnel wise. I expect analysts are figuring that into their models and since GM is still EDS' largest customer it will impact future years earnings slightly. The only answer is for EDS to grow the non-GM business at a faster rate. The 24% this quarter was a good start.

Dave
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