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

To: Roads End who wrote (17265)	2/12/1998 8:05:00 AM
From: Kevin Chesser	Read Replies (2) \| Respond to of 97611

Even bears get an article or two. Look, Mason said the factoring was only done when it proved positive to the company. With $6+ billion in cash, you can bet on two things: (i) that CPQ has a professional money mgmt team looking at many opportunities for higher returns and (ii) that CPQ sees many opportunities at attractive yields. Don't forget...accts receivable is cash too. I would be disappointed if mgmt did not expose all profit potential. Nonetheless, this article will shadow the stock for the next day or so in my opinion. Like the "channel stuffing" rumor, it will only be quashed by news from the company (likely in their next press release). Think about it...DELL is more "just a PC business" than CPQ. Seems this problem could loom larger for them someday. Kevin

To: Roads End who wrote (17265)	2/12/1998 8:56:00 AM
From: Mohan Marette	Read Replies (5) \| Respond to of 97611

Riechers: Thanks for posting Heard on the....from WSJ. You know it is not so amazing to find people who always griping about something,and you the example right here in the column. In an interview Wednesday, Earl Mason, Compaq's chief financial officer,acknowledged the transactions helped profitability. "It helps ROIC," he said. "Otherwise, we wouldn't do it." Mr. Mason also said the company factored more receivables in the second, third and fourth quarters of last year than it normally does. But he added the Houston-based company only uses factoring when it can get a "positive carry," earning more from the immediate cash received than it must sacrifice in fees and discounts to the bank or company collecting the receivable. Factoring is one the many financial tools companies use to manage cash flow, I have no idea what these nincompoophs are complaining about.In CPQ's case factoring was used because they could deploy the cash more efficiently than what they could have otherwise Like the man said, this did help ROIC 'otherwise we wouldn't do it.' But some analysts and investors say the DEC deal, while potentially a long-term boon for Compaq, could be masking problems in its underlying personal computer business. Oh great another big negative they come up with,for one thing DEC's PC business is not all that big, I believe their total pc sales amounted to just a billion dollars or so, and i am confident Compaq will easily handle this problem most likely by integrating the operation into CPQ's PC business. As far as cutting cost, they have been doing exactly that and the effort is continuing,if these people (DLJ or whomever) want instant gratification, they should go to some whore over at 42nd street.<gg> I guess there is no convincing some people,so I am going to just forget about them and enjoy my investment in the company.