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

To: Night Writer who wrote (92137)	7/11/2001 12:20:44 PM
From: MeDroogies	Read Replies (2) \| Respond to of 97611

Tough call, still. I agree with the premise. Whether or not he's made the right decisions and moves will take some time to really determine. I think he WAS on the right path before things went sour, but it seems he didn't have his finger on the pulse and lost 3 months (minimally) in determining that the overall strategy had to be altered. I have a difficult time with CEOs who pocket the kind of change he does and don't feel the same amount of pain as those he's "liberating". This isn't meant as a screed against CEOs or capitalism, mind you. But I'd like to see a CEO who has willingly cut back his salary and options as a means of showing that even HE is williing to take a hit for the company during the tough times. I'm not referring to MC in particular...it's just a general statement. It seems to me that feeling the pain in one's pocketbook makes one far more focussed on achieving goals that are set. If the company were properly righted, then it would make sense to compensate the CEO for doing a good job. I don't see this as a systemic flaw, but rather a flaw of character and purpose on the part of the many of our business leaders....particularly those who are close buddies with their boards. I know an accountant at LU who has told me about the amount of money that some of the executives left with after they'd effectively screwed the company over. I'm sure they haven't spent a minute thinking about the people who lost their jobs as a result of their crappy management.

To: Night Writer who wrote (92137)	7/11/2001 4:48:41 PM
From: Elwood P. Dowd	Read Replies (2) \| Respond to of 97611

Forbes.com- "IT'S TIME TO BUY COMPAQ" Wednesday July 11, 4:04 pm Eastern Time Forbes.com Time To Buy Compaq By Lisa DiCarlo It's not possible to fall off the floor. That's where Compaq Computer has been living for a few quarters, but there is evidence the company finally has made enough of the right tough decisions to be in a position for growth. The Houston-based company yesterday surprised no one when it said sales will fall short of estimates by 9% to $8.4 billion and that earnings per share will meet already lowered estimates of four cents. Compaq said it would lay off an additional 4,000 people--a total of 8,500 for the year--to bring expenses in line with economic realities. What surprised some analysts is that it took Compaq this long to make the tough calls. There is still fat Compaq could cut but the company is better positioned today than it's been in a while. Part of the reason for the rosier outlook is better expense management. Besides thousands of layoffs, the company is shedding its flagging Alpha server business, shaving hundreds of millions annually in development costs. And it has managed to reduce inventory by about $600 million or to about three weeks worth. "I'm glad to see them take the initiative and cut bloated costs. They have worked through most of the bad items," says Brett Miller of AG Edwards, who says the company has also streamlined its supply chain to better take advantage of drops in component costs. Strategically, Compaq finally will put services front and center in its approach to sales. Instead of leading with the hardware products and trying to sell services or consulting as an afterthought, Compaq will lead off with a solutions-oriented approach to selling, starting with services. This strategy has revived IBM's fortunes under Chairman Lou Gerstner. Compaq tried, and failed to capitalize on services it bought with its $9 billion purchase of Digital Equipment in early 1998. Now Compaq Chief Executive and Chairman Michael Capellas has said the company is looking to buy services companies, particularly for vertical segments like financial or healthcare. Compaq is growing faster than some competitors in the still-hot market for enterprise data storage. At $14.34, Compaq shares are down 5% so far today and 43% from a year ago and the projected price-to-earnings ratio is 29. That compares with a price-to-earnings ratio of 25 for Hewlett Packard and 34 for Sun Microsystems . The time is right to buy Compaq. While the shares are trading right about where they were at the start of the year, the company has since taken actions to kickstart its engines. Miller admits he was about six months too early with his "accumulate" rating but says he likes Compaq's aggressive moves to diversify its business--48% of sales still come from PCs--and cut costs, which he believes will land the company on the upside in the long term. "They are executing on plan given a very poor market and they've pretty much bottomed out," Miller says.