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

To: Tweaker who wrote (24960)	4/25/1998 7:29:00 PM
From: FR1	Read Replies (1) \| Respond to of 97611

>I think we are about to begin the biggest upgrade cycle since the original IBM PC. How about a basket of CPQ, DELL, HP and GTW? < I sort of agree. DELL Bad Points: They can only pull it off by selling high end desktop machines where all the fat is. Notice they have no $500 (or even sub $1K) computers. When the big boys finally: Get a clone of DELL's online and direct mail system + whack the hell out of the profit in high end desktops, DELL may have a very serious problem. Also, if people settle on super sub $1K machines and there is one available at every drug store, Radio Shack, etc., people would just as soon buy locally where they can see the machine. DELL Good Points: They have super low overhead since they build only to order and have no channels to stuff with computers. The web sales, to everyone's amazement, actually brings in very big returns and has nowhere to go but up since more people coming on line. DELL seems to say: I can cut my high end desktop prices better than anyone because I know what you have to charge and I have a lower overhead. So far they seem to be right. Even during the latest blood bath DELL's high end desktop prices are just as low as IBM, HP and CPQ. I buy this stock. GTW: I saw the CEO on CNBC recently and was super unimpressed. Zero ideas. Could not even describe a future plan for the company. This guy would be fired in any big city. He just continually talked about how they loved their customers. I know GTW stock has done OK, but I can't figure out why. Somebody tell me why Gateway is still alive! They are right about one thing: A cow eating grass is the right mascot for this business. I vote no. HP: Maybe. They have all the weapons and definitely all the troops, but HP has always said they will be king. Always the same results. They are like IBM - enormous diversity of products but somehow they just seem to be like a giant government that can't move. The old joke in the industry is that HP invents the product and other people sell it and make money. Changing HP direction is like turning a super tanker. I vote "show me the money". CPQ: The best prospect. Why? Because you have a chance to reshape a enormous computer business at a time where big company changes are needed to keep up with changes in the market. Everyone expects a big shake-up and layoffs which also helps (they expect to be changed). CPQ also has the right people to do the job (many came from DEC). Just the savings on middle management consolidation will be big $. I vote yes. So, personally, I buy CPQ and DELL.