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Technology Stocks : Compaq
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To: Merlo who wrote (31606)8/26/1998 8:15:00 PM
From: D. Swiss  Read Replies (2) of 97611
 
Merlo, I hate to break this to you, but you need to do a little homework. If you look at the recent IDC report, it shows Dell growing at the rate of 75% while CPQ is growing by 17%. CPQ's model cannot compete with Dell. Forgetting about the middleman mark-up which Dell doesn't have, Compaq has about 40-50 days of inventory vs. Dell's 8 days. With component prices falling at the rate of 1% per week, that gives Dell a built in 7% price advantage not to mention the consistently higher PC magazine quality ratings where Dell is consistently #1 or #2 and CPQ is usually 7 or 8.

Best of luck to you. Be careful though, Dell continues to gain market share while making more profits than CPQ, IBM, HWP and GTW COMBIMED for the past two quarters in the midst of a price war. Can you imagine what Dell will make when pricing pressures ease as they are now.

:o)

Drew
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