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

To: hpeace who wrote (15794)	1/31/1998 7:44:00 PM
From: Loki	Read Replies (3) \| Respond to of 97611

I have watched the messages posted on the CPQ thread for some time and found them extremely informative and interesting. Thank you. Having recently resigned from a board of directors with a corporation that was attempting to integrate another corporation (after acquisition) I am sensitive to the anxieties and psychology that could presently exist at both CPQ and DEC. During transition time many employees (epsecially management) are extremely busy re-establishing their position within the corporation. Redundancy threatens positions at both companies. (obviously more at DEC). There exists the potential for very much non productive work in the next couple quarters. Can CPQ direct a transition that allows DEC employees to maintain their pride and become more productive? Will Europe (that has a riskier exposure to Asia than US) maintain an economy that will meet analysts high forecasts in Q3 and Q4 1998? I have a long term interest in CPQ and believe they will do very well, but would very much welcome your opinion on the above points. Most of my other "concerns" have already been covered.

To: hpeace who wrote (15794)	2/1/1998 6:06:00 AM
From: Spots	Read Replies (2) \| Respond to of 97611

That's a factor of 43 (1,000,000/23,000). Using that figure, at current net margins and P/E (about 7.5% and 25 respectively, though that's not relevant as long as they stay the same), CPQ needs slightly over 1 trillion in gross revenues (1,058 billion as I figure it). This is without dilution by DEC, which is definitely a dilutive acquisition, even if it is accretive to EPS. Current estimate of the PC business world wide is 700 billion. I don't know just how high this "PC business" estimate goes into servers, and of course it's a very good bet the total market will continue to expand rapidly. However, there is a ceiling that didn't exist from 1992 to present. I'm long CPQ big time (a lot more than the 1000 shares mentioned a few posts back), but I'm sure not expecting a factor of 43 in 6 years. A factor of 4 (a trifle over 25% per year) would be very nice, thank you very much, if I'm lucky enough to get it, well, glad to have it! Regards