Michael... WE'RE FAMOUS!!! Check it out!!! jajaja El Transition
A Silicon Investor Highlight
By David Zgodzinski
February 1, 2000
If it were easy, we'd all be in the Bahamas. But some days the market just
doesn't seem to add up.
Addi wrote to the Compaq thread on Thursday, Jan. 27...
They say market has no logic, and it sure is true! DELL
misses its numbers and it goes up and instead CPQ gets
punished! Informix delivers its 6th consecutive 20%+ growth
and beating earnings estimates (even the so called whisper
numbers) very nicely, and instead Oracle (with only 10%
growth), and Sybase (with 0% growth) move up!
This is the kind of market that the technicians love to point out to the
fundamentalists. It's the kind of market when stocks seem to have a mind
of their own. They fly higher or lower in the face of earnings reports or
analyst recommendations or other fundamental stuff that in normal times
would be expected to push the stock the exact opposite way.
Annette wrote to the Qualcomm - Coming Into Buy Range thread on Jan.
27...
Can't tell anymore. Company beats the whisper number,
goes down.
Company warns and doesn't (beat the whisper), goes down.
Company beats the whisper number, goes up.
Company warns and doesn't (beat the whisper), goes up.
Company warns, analysts upgrade, goes up.
Company warns, analysts upgrade, goes down.
Used to be a bit more black and white...but now it's blurred
to gray!
Compaq had been trading higher ahead of the earnings report on Jan.
25.
PCSS wrote toward the close of trading...
CPQ SPURTING HIGHER 2.5 mil shares traded in past 20
min. 33 (even for the day) now.
The thread had been unused to upward momentum in their
long-suffering stock, and with Compaq's fourth-quarter earnings report, it
looked like there might be some follow through. PCSS wrote...
.19
Est.=.16 -------- whisper .17-.20
At first, the bulls were pleased. MeDroogies wrote...
Looks EXACTLY like AAPL did when I bought it and it
turned around. I'm really happy with these results. Capellas
will wow the analysts this week. We could have a barn
burner on our hands if he plays his cards right.
And rudedog wrote...
The revs were over estimates, and likewise the profits, this is
the high side of "predictable" and all in all a great report,
just what the doctor ordered.
But CEO Michael Capellas eased revenue expectations for the current
quarter. Captain Jack wrote...
Expectations were LOWERED! REVs are important to the
mkt although I have a problem with that as the cost of
boxes comes down as to this point CPQ is still a box maker
in most minds. A boxmaker losing share,,, and 15% is not a
growth tech stock people will want to buy or hold,,
Elwood P. Dowd lamented...
No CFO, no enthusiasm. I'm getting the Aqua-Lung out,
AGAIN!
Jimbo Cobb pointed out comments by Ashok Kumar, US Bancorp Piper
Jaffray's analyst...
'I think their time has come and gone,' Kumar said, saying
one of the only attractive things about Compaq is its
relatively low stock price. 'It's a value play more than
anything else.' A "value play"...the ultimate
insult!!!jajajajaj.
But others saw it, after all, as a period of transition. P.M.Freedman
wrote...
I was expecting $0.18. Now we got $0.19. However, I was
looking for revenues over $11b. The revenues make me a
bit disappointed. The ever-hot holiday sales of last month
did not bring higher sales (It indeed beat last quarter 1.3b).
The company reconstruction will continue until the whole
Digital to be digested.
Junior Balloon liked the new CEO's downplaying of future prospects,
writing on Jan. 26...
I suppose you would rather he set the bar high and fall on
his face? MSFT is the master of under promise and over
deliver. If Michael Cappelas can establish a few quarters of
beating the estimates I'll ride his PR blundering consistency
to 50 at the end of the year. This is not a bird. It is a proud
porcine oinker. Hear it OINK!
The Qualcomm - Coming Into Buy Range thread had been anxiously
awaiting earnings at the same time as Compaq.
jeremy_atticus wrote on Jan. 25...
I say 32 cents and a split!!!! Rick, remember what took us to
300 the last time, a split.
News hit that CEO Irwin Jacobs had been awarded a hefty bonus for his
good work in fiscal 1999. Besides the $773,085 in salary and a $975,000
bonus, Mr. Jacobs received 400,000 options on Qualcomm's stock priced
at $83.50. Mr. Jacobs already owned another 8.6 million Qualcomm
options, but no doubt he was thrilled with the bonus.
bruce gilling wrote at 4:37 PM on Jan. 25...
.25 beat street by 1 cent
Ed Forrest pointed out the problem...
Missed the whisper by .02
The mighty Q had missed the whisper. There had been other earnings
disappointments this quarter, but Qualcomm has been a bellwether and
the market wasn't in the mood for disappointments from the gorillas. jmac
wrote...
I think the Q is the only stock trading down in after-hours.
Missed the whisper, no stock split. now at 134 and change.
SpudFarmer thought about cultivating a bigger position...
Selling after hours in 130's to 140's is panic. Foolish at best.
But, it will give me a chance to buy more tomorrow? Maybe
I should start stealing some shares after hours myself.
Qualcomm's net earnings for the first quarter of fiscal 2000 were $192
million, a record, and almost 300 percent better than the same period the
year before. But this wasn't enough to impress the market. The worst thing
in the eyes of the Qualcomm bulls was the relative performance.
RocketMan wrote...
Who would've thought that tulip ebay and pos (piece of
stock) compaq would rise and qcom would drop after
earnings. What a crazy market. Think I should just turn this
thing off and come back in six months.
Craig A watched the stock trade down and sounded bitter...
Around 137 now. Maybe I'll sell all my QCOM,JDSU, NOK,
and buy Disney or Fruit of the Loom. This
cellular/technology/internet thing is all over. Who said turn
off the computer and come back in a year? Well said.
It wasn't just that Qualcomm had failed to meet the whisper number. The
company also warned that the current quarter's sales would be somewhat
lower than expected.
CRay33 wrote about his impressions of the conference call...
- MSN chip shipments lower due to seasonal (post holiday)
- See this as temporary - CDMA wins are strong
- Licensing up significantly
- Q2 at least .25
catechtrader saw the good news...
This was a good report, a transitional quarter, beat the
street and is starting to be smart like MSFT in being
cautious about its forward looking statements...MSFT is
always cautious and always beats the street.
But William Hunt saw the clouds inside the silver lining...
You have to wonder what is happening at "Q" when TDMA
at "T" seems to be going gangbusters when "Q" supposedly
has a superior product yet we are laying off a thousand
people and talking about weak sales this qtr ?
The following day the DELL thread got a rude earnings awakening. BBG
broke the news at 4:32 PM...
DELL JUST WARNED OF LOWER THAN EXPECTED
PROFITS IN Q4.... No details yet but looks bad...
And TRCM wrote...
DELL pre-announces - .16
The explanation for the shortfall was the Y2K slowdown and shortages of
parts from suppliers hurting shipments. Sam Bose wrote a synopsis of the
conference call for the thread...
The general perception in the analyst community is that
DELL failed to accurately forecast the Y2K shortage (not so
much the "component" problems) unlike HP and IBM that
came out well ahead of the pack last year to warn. DELL on
the other hand kept misguiding analysts by constantly
stating that "we will not be affected by Y2K". This now will
come home to roost with a credibility problem with the
Street.
Patricia Walton agreed...
The poor timing of this warning and the lack of support we
have seen from Dell's management in stock buybacks. I
think I am speaking for several others when I say I am
stunned, not that we warned, but by how much we will miss.
I would have responded earlier, but I was having a hard
time getting my head out of the sand.
The stock sold down after hours and Joseph Francis Torti was bitter...
I checked the numbers Dell did 16 Cents in January 99 and
they are going to do 16 cents this coming February so that
means Zero profit growth last quarter to quarter. No problem
all internets stock going up with report of minus eps and eps
like Ebay which earned 4 cent to two and still manage to
go up 17 points. lol I still have faith (albeit very little) in you
retards to bid this up anyway.
And the bulls did continue to see potential ahead. Darrell Smith wrote...
Both China and Latin America are booming. both will
begin to come to full fruition this year for Dell. Let's talk
again December 2000. at least we're dealing with
substantially lowered expectations.
edamo came up with a scary thought...
Maybe dell has "dellmolished" the competition so badly,
that they are no longer pc centric dependent on
revenues....hard to win a fight against one who doesn't care
if they lose anymore...just wears the champ down, until he
becomes brain damaged....
But jim kelley offered another perspective...
DELL missed the quarter by 10 days worth off shipments on
the revenue side. They are growing at a rate that has not
been seen before in a company their size. They are moving
in uncharted territory.
Overall, it seemed as if some trust of the thread had been broken. John
Koligman wrote
Here's the WSJ article on Dell. First Mikey says '2000 will be
a great year' Now Mikey says 'we need to kickstart demand'.
Then Mikey says 'we don't see any Y2K issues', now Mikey
says 'the biggest impact on our quarter was Y2K'. Is this
'Taco Dell'???
Oddly, the day following the earnings warning, a number of analysts
actually raised their ratings on Dell. Perhaps the lowered expectations
and stock price had something to do with it. DYW wrote...
Remember all those posters cynically stating that DELL
might fare better if it too had warned. Well, they may very
well be proven right today.
Jim Bautch analyzed things a little differently...
Shorted the dog meat out of this overvalued hog today.
After calling analysts various names, he added...
What a joke. five upgrades. severely slowing growth and a
p/e north of 60. these guys are good.
Elwood P. Dowd may have taken a little bit of satisfaction in watching this
competitor in the Southwest box-making conference take a hit. He
wandered all neighborly like over to the DELL thread on Jan. 27 and
wrote...
For those of you who are underwater, I'll be happy to fill
your SCUBA tanks for free. I've been underwater so long
with my CPQ that I finally bought my own air compressor!
jajaja
Some Dellheads hoped that it was just a perception thing. JRI wrote...
(Analyst Ashok) Kumar, apparently, is looking for 35%
revenue growth (in the next year)...exactly what I posted in
my analysis yesterday....Similarly, Kumar believes Dell is
trying to underplay (Intel/Microsoft) earnings in the coming
period....
jim kelley replied...
Reminds me of the Saturday Night skit on "Lower
Expectations" where the fat guy gets a fat girl.
The hope seems to be that it's a transition, a sign of maturity. Lower the
expectations and then blow them away. Microsoft has been doing it for
years and the market loves it. It's a matter of changing perceptions.
At least that's what they're hoping it is this time. And they're hoping even
more that these reduced expectations don't become an extended reality
into the next quarter.
Discussion
Threads
Compaq
Qualcomm -
Coming Into Buy
Range
DELL
SI Members
Featured
Addi
Annette
PCSS
MeDroogies
rudedog
Captain Jack
Elwood P. Dowd
Jimbo Cobb
P.M.Freedman
Junior Balloon
jeremy_atticus
bruce gilling
Ed Forrest
jmac
SpudFarmer
RocketMan
Craig A
CRay33
BBG
TRCM
Sam Bose
Patricia Walton
Joseph Francis
Torti
Darrell Smith
edamo
jim kelley
John Koligman
DYW
Jim Bautch
JRI
Are there some new developments on your thread? Radical personalities? Hot New technologies?
Takeovers? Scandals?
Please let us know. All stories are welcome.
Dave Zgodzinski
DISCLAIMER
All quotations from threads are the opinions of the members who made them. No attempt has been made to verify
the accuracy of these statements. No investment advice quoted on the threads is endorsed by the writer or Silicon
Investor. The statements are included strictly for entertainment purposes.
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