Compaq Message Board - Msg: 6786356

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Technology Stocks : Compaq

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To: Roads End who wrote (39571)	12/11/1998 8:22:00 AM
From: JRI	Read Replies (3) of 97611

Re: The Wall Street Journal article... I am in favor (of course) of good pub. for Compaq here, but a couple things in the article were not well-handled: (1) IMO, the reaction to Dell's last earning report (so far) on Wall Street has actually been quite good....given it was a supposed "disappointment"....If you look back over recent history (on Dell) there is usually a much bigger sell-off (and dead period) in the stock 4-6 weeks after earnings announcements... (2) Can anyone here honestly say they think Compaq is going to (consistently) grow earnings at a rate of 45-50% for any significant length of time...IMO, Compaq is not currently structured for this sort of hyper-growth..and it is probably not beneficial to have that number floating out there.....unrealistic expectations do not help the long-term stockholder.... (3) For most managers, it is probably not a decision of either Dell or Compaq...they probably hold both....They do not "sell" Dell and "buy" Compaq... (4) <If Compaq captures the same 19% market share in the direct market...> Only a fool would believe that direct sales are NOT going to, in part...perhaps a large part, canabilize existing indirect sales.....I think looking for anything close to 19% in "direct" share (while maintaining 19% in "indirect") is a real stretch here....actually dreaming.... Again, I am in favor of bullish reports...but one quote stands out here..."The bar is set so low for Compaq..it will be like a baby step.."...Yeah, and let's keep it that way!

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