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Technology Stocks : Compaq
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To: rudedog who wrote (49113)2/22/1999 6:31:00 AM
From: rupert1  Read Replies (1) of 97611
 
Good Morning rudedog: Welcome back and good news about your recovery. In your absence I commented that we missed your guidance on the 4th Quarter Receivables issue (although she_x did make a helpful intervention). You are too generous in excusing jim kelly. Read the following:

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To: +Riechers (49022 )
From: +victor Saturday, Feb 20 1999 5:59AM ET
Reply # of 49115

If anybody was in doubt about the source of the recent revival of "channel-stuffing/inflated receivables" rumour look at this jim kelly post to Elwood on the DELL thread. Notice that it starts with an assumption, and ends with a maybe.

But hard-hitting CPQ agnostic jim kelley, turns into sensitive true believer, when Michael Burke gives him a shot of skepticism on the subject of the sacred DELL.

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To: Elwood P. Dowd (103184 )
From: jim kelley Saturday, Feb 20 1999 3:29AM ET
Reply # of 103269

Elwood,

I know you can read but can you comprehend?

CPQ's Q4 earnings do not mean much if anything if they are stuffing.

Q1 and Q2 will reveal that CPQ stuffed the channels to arrive at their their earnings. One month's worth of stuffing of desktops and servers did the trick. So we will have to average their quarterly numbers to determine the fair price of the stock.

IDC's numbers show a huge bulge in server and desktop shipments in Q4. Just like last year. Likewise there was a huge increase in accounts receivables. Last year they did not have this huge increase because they factored the stuff. This year the factors are too smart for that and CPQ has to carry the accounts receivables as well as the promotional rebates into Q1 and Q2.

So be a good boy now and go suck on some more golf balls with your menage


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