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

To: peacelover who wrote (21784)	3/14/1998 12:57:00 PM
From: S.C. Barnard	Read Replies (1) \| Respond to of 97611

There need to be more reasons than 'because it will be a good buy then', lets have them. The ANALyst/FM with the most compelling arguement gets some of my attention, and even then, brother, they had better compel, with tap shoes!haha. Dance!! kpow!!

To: peacelover who wrote (21784)	3/14/1998 6:26:00 PM
From: van wang	Read Replies (1) \| Respond to of 97611

peacelover and Jack...I will take a crack on the $6-7 decline for better value... right now first call's revised earnings estimate is 88 cents for FY 98...at 25 1/2...that is 28.9X forward FY 98 earnings...and 16X FY 99 earnings of about $1.6...the industry forward PE 21.8....historical average PE for CPQ is 17 PE industry growth is 18%...CPQ long term growth is estimated at 20%...vs LT growth rate..CPQ's forward PE is 1.45X its LT growth while the industry is 1.2X LT growth...the industry is overvalued relative to its long term growth rate and CPQ is overvalue relative to its LT growth rate and relative to other competitors in the industry I expect CPQ to break 25 and trade 22-23 in an upbeat mkt...if the mkt or industry/sector corrects...then CPQ will trade to 18-20...that is when I hope to close my short and go neutral or small long... unfortunately, even when CPQ is 18-20 it still trades at 20-22X forward earnings (that is how that guy gets 6-7 more in decline) ..the co's historical average PE is 17...the sector and associated cos. within the sector are overvalued and the correction began 3 weeks ago... and is only supported by a rising market... but on low end earnings 22X is a good entry point IMO...and scaling in if CPQ goes down..mkt trades in excess...and CPQ performance is damned for 2-3Qs as indicated by estimates which I believe to be valid in light of the many issues outstanding with CPQ GTW is one of the few cos. trading up...but it is one of the few box manufacturers whose forward PE is still below its estimated long term growth rate without information which raises CPQ's earnings...the share price will decline steadily...the analyst's revisions have move CPQ from being fairly valued to overvalued in a matter of weeks...believe it or not, CPQ is overvalued relative to DELL given their respective estimated growth rates and risk...of the sector, DELL and CPQ are with highest overvaluation among stocks that have not been drag thru the mud like MUEI pls no hate posting...you can check this out yourselves on First Call...zacks has not updated their figures, they still show $1.6 for FY 98... there is no shame in selling and buying back IMO...pls do your own research cheers

To: peacelover who wrote (21784)	3/14/1998 7:21:00 PM
From: Jack	Respond to of 97611

I am neither short nor long CPQ. I am just trying to understand what the proper buy price for this stock is. Please do not kill the messenger.