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

To: Dulane U. Ponder who wrote (16625)	2/4/1998 6:56:00 PM
From: TechMeister	Read Replies (2) \| Respond to of 97611

Playing with DEC compaq numbers... CPQ DEC Rev 97 $23 B $13B Earnings 97 $1.9B $0.2B Earnings % 8.2% 1.5% Estimated 98 Rev $30 B $15B Est 98 earnings $2.46B $0.225B <====IF DEC continues as it is $1.23B <=== If CPQ can get same % earnings from DEC revnues, as from its own operations, ONCE they integrate DEC business smoothly and eliminate all lossy areas.(FAT) That gives net Revenues for DEC-COMPAQ of $45 Billion with earnings of $3.69 Billions = (1.65 Billion shares) = $2.33 EPS potential. At a PE of 25 (reasonable) we can project a target of 25*2.33 = $58 as a FAIR valuation of CPQ stock in one year. Any comments?? -TechM