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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Elwood P. Dowd who wrote (92056)	7/7/2001 8:15:01 PM
From: John Koligman	Read Replies (2) \| Respond to of 97611

Barron's had an interesting chart today featuring one of the indicators I like to watch, namely Price/Sales. Compaq is included, but look at what they imply for SUNW! As for the market, I'm daytrading as I mentioned some time ago till earnings season blowups end.... Regards, John Revenues Matter High prices/sales ratios can indicate unsustainably wide profit margins, which can attract competitors, driving down profits. The table compares the current price/sales ratios for some major tech companies with their 10-year averages and shows where their stock prices would be if they traded at their 10-year average price/sales ratio. By that criterion, Hewlett-Packard and Compaq look attractive while EMC and Microsoft appear expensive. Company Stock Price Price/Sales Ratio 10-Yr Average Price/Sales Implied Stock Price IBM $106 2.1 0.8 $42.90 Hewlett-Packard 26 1.1 1.3 31.80 Sun Micro 14 2.2 1.0 7.50 Microsoft 66 13.4 8.6 46.00 EMC 22 5.3 3.2 14.90 Compaq 15 0.7 1.0 22.40 Dell 26 1.9 1.2 17.20 Gateway 15 0.4 0.7 23.80 Micron Tech 39 6.0 2.5 16.70 Intel 28 7.0 5.1 20.00 Oracle 18 10.0 6.3 11.25 Cisco Systems 17 5.6 11.0 36.00 Sources: UBS Warburg; Merrill Lynch