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

To: Thomas C (Hijacked) who wrote (20503)	3/7/1998 10:03:00 PM
From: Roads End	Respond to of 97611

Thomas...<What makes Dell so damn different from the Compaqs of the world anyway!!?> Their success comes from the JIT inventory model used. The reason that model works is that there is over capacity in the component suppliers. Look at it this way, If Pchips were in short supply would Intel sell them to a buyer who will buy 100 days supply or a commitment for a 5 day supply? Ask the same for disk drives, Video cards, Modems. Now think again, if a new next generation chip comes out that is hot, hot, hot will Intel sell it to 100 day contract or 5 day. Intel and all the other component suppliers knows who butters their bread and I do not believe it is JIT modelers.

To: Thomas C (Hijacked) who wrote (20503)	3/7/1998 11:05:00 PM
From: gc	Respond to of 97611

The diffenence is that people buy computer from DELL. I just did with a 266 laptop purchase . CPQ does not even offer one. By the time they offer one, DELL will have a better model. See the difference?

To: Thomas C (Hijacked) who wrote (20503)	3/8/1998 12:05:00 AM
From: john dodson	Respond to of 97611

Tom, Dunno if Dell will follow with a warning or not, but I guarantee you if they do, DELL's drop would make CPQ's drop look like nothing. IF DELL announced the same thing CPQ just did, that is that they will have a break even quarter and not earn anything, DELL would open $20 lower (pre-split), and drop from there barring any fantastic spin by DELL mgt. That's just what happens when a huge grower like DELL has such a rich multiple (> 50). However, I don't see that as very likely any time soon. With the quick flood of reassurances on DELL's part, they've really laid all their credibility on the line. So far, the Street has been wise to follow it. So, now shouldn't be any different, right? -John Dodson

To: Thomas C (Hijacked) who wrote (20503)	3/8/1998 12:46:00 PM
From: BarryH	Respond to of 97611

I think Dell is 6-9 months away from a flattening of sales. Dell is like IBM was in 1985. All the MIS types speced out IBM PC's because of their quality reputation. After about a year it was obvious to them that the clone maker had a cheaper and better quality machine. In a few months the financial types will ask why we're spending so much for Dell. A quarter or two after that..Dell will flatten. However, Dell may be able to adjust with prices, but their margins will shrink. As for Compaq...I'm happy to say that I shorted them early last week at 29 5/16 and I'm looking to exit at 25. I think the stock may bounce to 26 by the end of the day. Remember that it's fallen from 35 already so the analogy with Intel short term isn't the same. I'm very negative of them long term. I don't see how the DEC merger will fit in. When you think about it you can do the same thing that Compaq does in your garage.Assemble and sell computers..except of course they can it cheaper and faster. So their essence is really as a marketing aninmal. I don't think they are sophisticated enough to know what to do with DEC..or to manage them..DEC couldn't even that..and in all the turmoil Compaq will lose it's focus..Intel makes chips..and Dell makes PC's..that's all they do..Compaq makes PC's, continous running redundant systems for banking and the like ..and now workstations, mini computers and anything else DEC was doing..they don't strike me as great managers..just great marketers..My thoughts are 25 tomorrow..and 15-17 by the end of the year..