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

To: Stonehenge who wrote (21862)	3/14/1998 9:07:00 PM
From: Jack T. Pearson	Read Replies (1) \| Respond to of 97611

Stonehenge, "Where do we go from here?" I don't know for certain. The following is just my opinion: I believe the inventory problem will clear in a month or two. It is a few hundred thousand out of more than 6 million they will sell this year. Not even a month's supply, and it isn't in all of the market segments. When tech stocks get hit like this, they generally get oversold. I think this has happened to CPQ and plan to buy Year 2000 leaps on Monday. On the other hand, I don't think Compaq has not achieved what they wanted in terms of shortening the cycle time from production to sale to the customer. When component prices fall rapidly and component performance increases rapidly, the time it takes from the time they commit component orders until the sale is made is of critical importance. An extra two to four weeks cycle time could be worth a couple of points in margin, but I'm not certain as to the actual impact. Jack