April 19, 1999
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Compaq Shrs Up In Early Trading After Pfeiffer Ouster
By CHRISTOPHER GRIMES
Dow Jones Newswires
NEW YORK -- Compaq Computer Corp. (CPQ) shares were trading slightly higher Monday after the company's surprise dismissal of Eckhard Pfeiffer from the chief executive's office.
The stock was recently trading at 24 9/16, up from Friday's close of 23 5/8.
Pfeiffer resigned Sunday after a weekend meeting with two board members, Benjamin M. Rosen and Ted Enlow III. Rosen will act as chief executive until a replacement for Pfeiffer is found. The company has hired Heidrich & Struggles to lead the search. Earl Mason also resigned as chief financial officer, Compaq said.
Ashok Kumar, an analyst at U.S. Bancorp Piper Jaffray, said he was impressed with "the immediacy of the board's action.
"The company had all the building blocks to be a world-class player," but wasn't living up to its potential, Kumar said.
And he added there was a widening "credibility gap" between management and Wall Street in light of recent missteps.
Compaq shares touched 51 1/4 in late January but fell to the low 20s after the April 9 disclosure of a first-quarter earnings and revenue shortfall.
Kumar said the stock is "at the absolute bottom or close to it."
Dell Computer Corp. (DELL) shares recently traded at 39, up from Friday's close of 38 1/4. International Business Machines Corp. (IBM) shares were up too, with a recent trade at 171 3/4, up from 170 3/8 at the close Friday.
Intel Corp. (INTC) shares were down slightly, at 56 5/8 after closing at 57 1/4 Friday.
- Christopher Grimes; (201) 938-5253
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