George,
Compaq has become DEC. .... As there was periodically with DEC there will be a great buying opertunity with cpq. It may be now. It may be 18 1/2 like it was once for DEC (before the run to the 70's)... Let's not miss it. But let's be a bit late rather than way early.
After looking at the CPQ chart, I have sort of been thinking along the same lines. There have definitely been some big swings that could have been played. I made money in the past by playing the swings in DEC's price using common shares and call LEAP's. I only played the upswings, since, with DEC, I found it easier to get a sense of when it was undervalued vs when it was overvalued.
As I recall, the time I made the most $ was when DEC went into the pits, and the LEAP call premiums dropped. I will definitely be looking for the same thing with CPQ. cboe.pcquote.com
I agree with the too late / too early sentiment. Now that CPQ's momentum has been broken, and the turmoil in the senior management level, it might have a hard time picking up steam, and could be vulnerable to more selling if there was a sell-off in the tech stocks. I recall thinking at the time, that what really put the bottom under DEC's price was the amount of ca$h it was holding, not its low P/S ratio.
By-the-way, when I was going through the thread, I found the following post from Oct 1997, which was posted by Tom Michaud which contained some rather innacurate predictions from the press (not from Tom of course):
"When the first IA-64 Merced processors ship in two years, the chips will face plenty of competition. IBM, Sun Microsystems, and even Hewlett-Packard are already delivering alternative 64-bit RISC CPUs and have higher-performance CPUs in development. ... The below Oct 21 Infoworld link finally mentions 64-bit NT on Alpha.
"It's clear that Digital is working with Microsoft to implement the first 64-bit version of NT, siad Jim Garden, VP of Technology Business Research, in Hampton, N.H.. Alpha may be used as a 64-bit [NT] reference platform to be ported to Merced in 1998" #reply-2526002
Regards,
John Sladek |
