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Technology Stocks : Compaq
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To: Captain Jack who wrote (61820)5/20/1999 11:54:00 PM
From: rudedog  Read Replies (3) of 97611
 
One point that many on both the DELL and CPQ threads have missed is that DELL has 2 1/2 times CPQ's market cap on half of CPQ's sales. It's no wonder that the street expects perfect performance from DELL. CPQ by rights ought to be able to screw up for a while without affecting stock price. If CPQ had the same ratio as DELL, CPQ would be at 150. Something to ponder, I guess. Also gives me a gut feel for the potential of the two stocks. If we assume that CPQ was reasonable at 50, then DELL would have to grow to more than twice its current revenue at the same share price, given equal expectations. At their current rate of growth that would suggest stock prices in the 40's for 18 months... a scenario that would leave many DELL investors cold.

I don't think that will actually happen, but I could see DELL still in the 40's at year end.
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