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

To: Walter Brownlee who wrote (20119)	3/6/1998 9:35:00 PM
From: Thomas Dremel	Read Replies (2) \| Respond to of 97611

My earlier post that CPQ had NOT released a preannouncement of bad earnings was absolutely correct as of FRI AM - so I wasn't wrong at the time. The announcement by CPQ FRI PM is a shocker - no earnings for the 1st quarter with flat sales from a year ago. Plus, earnings are not expected to improve in the 2nd qtr. In addition, DELL is doing just fine with their direct sales model - thank you very much. What's going on my head right now is this. Is the direct sales model the only way to go, ala DELL? With price competition as keen as it is right now, can CPQ really afford the middleman? Or is CPQ just in a transition- "getting rid of the old junk"? Whichever case, it seems that the direct sales model has advantages over CPQ's... build up the inventory, let's get of the old crap every once in a while model. I have a minor postion in DELL, a major position in CPQ (for me anyway). I now have my doubts about CPQ. I won't sell any CPQ right now, I've held CPQ for awhile and still have some good gains. But I'm questioning CPQ's middleman approach to selling machines. Any others? Tom D