Jenne... I think nets will be OK... here's an article from J.Cramer, TheStreet.com..... on CPQ, it's surprize to Wallstreet, and where people will be investing...not PCs... net YES, telecom YES... see bold below.....
The Street Gets Sandbagged
By James J. Cramer
4/9/99 6:49 PM ET
Why does the Compaq (CPQ:NYSE) news send a shudder through the Street? After all, didn't everybody know that Compaq was having a tough quarter?
Two reasons. One, it is true, we all thought Compaq was going to have a bad quarter, In fact, much of personal computer tech (as opposed to telco tech or Net tech) had been held in check by potential Compaq woes.
But when we got through March without any bad news from Compaq, we thought we were home free. Preannouncement season has no proscribed periods, but it sure as heck was supposed to end last week. When we got through to this part of April, we figured Compaq couldn't have missed. I know I thought my April 30 and 27.5 puts were rip-ups because, with a week to go, nothing seemed like it was going to happen to put those in the money.
I thought there wouldn't be any more bad news. In fact, I started rebuilding my Intel (INTC:Nasdaq) position Friday precisely because I thought we were out of the woods because Compaq hadn't blown up.
Wrong!
Now a lot of people will be out of position Monday because we thought that preannouncements -- especially preannouncements from one of the largest computer companies -- were a thing of the past.
The second reason, however, is the darker one. COMPAQ ONLY MADE FIFTEEN CENTS!!! Fifteen measly centavos. Holy cow, that's half of what the Street was looking for. Numbers don't just have to come down, they have to come way down. The Street was sandbagged by this. The Street hates being sandbagged. It exacts revenge against sandbaggers.
I believe Compaq waited until as late as it did to preannounce because it was hoping to say that business had picked up near the end of the quarter and that April had started off strongly. It clearly hasn't. So, it is reasonable to presume that, besides Compaq downgrades, we get a host of downgrades in the industry on Monday. I think those downgrades will produce long-side opportunities, but not in personal computer techs.
To me, I envision a landscape that has all of tech down, for which I will first buy the Web -- don't forget the Web actually benefits from the coming PC price war -- then buy telco tech. I would only buy personal computer tech at the end of the day, if at all. I might try to average down on Intel at 125 if it gets there, for a trade into the quarter after the close Tuesday. But don't pin me to it. I want to see how ugly things get.
As for Compaq? I will cover my short, but I don't think I can go long.
No execution, no growth, no guidance? No go long.
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