CompUSA (CPU) Message Board

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Non-Tech : CompUSA (CPU)

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To: Michael who wrote (1244)	2/12/1999 6:25:00 AM
From: Bill Wexler	Read Replies (1) of 3187

I don't think you have much to worry about in that regard. There is no evidence that management has done anything underhanded. It seems to me that they are doing their best to consolidate (i.e. the CC acquisiton) and enhance shareholder value (CPU direct). Remember that many retailers are cyclical and CPU is no exception. I don't expect CPU to be going out of business but it is possible that the stock can be ho-hum for years. One of my best performers in 1998 and early 1999, Costco, was a complete bow-wow from late 91 to early 96. However, if you would have kept checking in on the story and continued buying steadily through the entire period, you would be quite wealthy today. I think that the tech retail sector follows faster cycles - and CPU's business plan is already mature, so (barring any market cataclysms) I don't expect 5 years of drought...but it is conceivable that we may have to put this one in hibernation for another year or two. One strategy I suggested for those that may worry about the stock flatlining over an extended period is to sell the Jan. 2001 20, 22 1/2 and 25 calls to cover your long position.

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