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

To: Dr. David Gleitman who wrote (33378)	9/24/1998 7:54:00 AM
From: tonyt	Read Replies (2) \| Respond to of 97611

Re: 'putting all your money into one stock' Margined?

To: Dr. David Gleitman who wrote (33378)	9/24/1998 11:26:00 AM
From: Dr. Id	Read Replies (1) \| Respond to of 97611

I'm just as fed up with CPQ. However, I got smart by selling my other core positions and putting it into DELL. Once I can get above $36.00 on CPQ, I just may stick it all in DELL. I would be VERY careful about this. Do you realize that DELL has a book value of $1? THat means that to maintain their current valuation, the company needs to keep making profits of 50% per year (approximately). As computers become more of a commodity and prices come down, DELL will have a harder and harder time making their numbers. CPQ on the other hand, has forseen these days and has shifted their business plan toward a full service company (where margins can more easily be maintained). Also, CPQ doesn't have to meet the expectations that DELL does to maintain their share price. At some point the bottom will fall out of Dell. Hard to say when, but it seems as certain as it seemed that this overextended market would tank. JB