Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Hewlett-Packard (HPQ) -- Ignore unavailable to you. Want to Upgrade?

To: Oeconomicus who wrote (2619)	2/26/2003 12:40:31 PM
From: The Duke of URL©	Respond to of 4345

I appreciate your comments. The annual report is 150 pages long. Any light is what SI is for. I do see that 14 Billion of the cpq acquisition price of 24 billion, is allocated to good will. Under the new rules, that does not need to be written off. That's 350 Million a year in extra "profits". Also, the whole purpose of this merger is to cut the expense of the direct competition between hp and cpq. That is being done. And it is to be expected that costs get cut first, then revenue is built. Therefore, the restatement of q 1&2 to show cpq and hp AS IF they were already merged is exactly what you want from a management standpoint. In english, if you go to compusa, there is now only cpq, where before was cpq and hp. This may result in slightly lower sales but much better profit for the [combined] company[ies]. I am not saying that I am happy with the progress of the company, I am just saying that these high paid stock pickers should understand as much as we do in order to issue these predictions.

To: Oeconomicus who wrote (2619)	2/26/2003 12:43:46 PM
From: Kirk ©	Respond to of 4345

It seems rather odd that a company with this much operating leverage, making money and paying a dividend that is now over 2.0% (much better than I can get in a money fund) is not a buy here just for valuation. The only reason to see it go this low is a belief that HP will lose market share and/or the whole market is going to crash... but this is not reflected in Dell's prices AND the data says HPQ is taking market share (sun and gtw probably). BTW, they could have had higher revenues at the expense of profits... Mayb the analysts are missing the fact that HPQ erred on the side of "too much profit?" Kirk

To: Oeconomicus who wrote (2619)	2/26/2003 12:44:16 PM
From: Elroy	Respond to of 4345

I think it's an over reaction (stock down 13% now) for a 3% revenue miss. One problem is most every analyst came out with their HPQ previews last week saying that these are my numbers and I wouldn't be surprised to see an extra $100 million on the top line and an extra 2 cents EPS over my numbers. Thus, investors were expecting them to beat both revenues and EPS. Since most of the revenue miss was in PCs and enterprise hardware (which both don't make any money) it don't really matter to me. With HPQ now at 13x $1.20 EPS (just annualize the current quarter) it seems pretty attractive to me. Good - Gross margins up, operating margins up, printing/imaging still growing and dominating the world, more cost reductions still to come once those hard working Europeans get fired with their mandatory government regulated one year notice, analysts turning bearish (goodbye Conigliaro, and don't come back) and a nice valuation. Bad - Half the business is still crappy hardware and sales in that business area were weaker than HPQ's November guidance, uhmm, anything else that was particularly bad? Can't really think of much except they sold a few less money losing servers, work stations and PCs than they could have. Oh well! Elroy