To: dmf who wrote (104944 ) 6/27/2000 11:26:00 AM From: Tony Viola Read Replies (2) | Respond to
Hi dmf, article from the Compaq thread has good news in it for Intel. NT servers are Compaq's hottest product, and they all run on Intel Xeons or PIII type chips. The article says NT server sales could account for nearly 25% of total Compaq sales by the end of the current year. Compaq should be about $40 billion in sales, so NT servers could be close to $10 billion alone. Throw in Dell, IBM and HP and that's a lot of Xeons, etc. Intel has announced 700 MHz Xeons with the big caches, and those guys are all shipping servers with them inside now. That'll give another boost to sales of this class server.head of Compaq's NT server division. Mary's division accounts for approximately 20% of total sales but is experiencing 25% growth rates, well above the corporate average. NT servers also drive a higher gross margin, around 32%, versus the company average of 22%. We believe NT server sales could account for nearly 25% of total sales by the end of the current year. In conclusion, we feel more confident regarding the pace of business in Compaq's current quarter. The company's server business is at least on plan, if not ahead, and is the central theme of our recommendation. Internet-centric computing is about the server, not the desktop. We believe Compaq's stock should be bought at current levels and remains the best risk/reward call in our group. We see very little downside and still believe the stock can hit $45 following a postive conference call in July. The investment sentiment for the entire PC group has become very negative and yet the fundamentals remain sound. We believe Compaq and other PC companies will make Q2 numbers and speak to bullish trends and easy comparisons expected in the second half. The PC stocks should be bought here. <<
