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

To: PCSS who wrote (34133)	10/7/1998 8:10:00 PM
From: rudedog	Respond to of 97611

In 3Q last year, CPQ gave up nearly 10% to the channel in various kinds of price protection. This quarter, I would expect the number to be well under 1%. That has got to have a huge impact on the bottom line. And, as you say, the dealers who are trying to get those CPQ units will probably not have much leverage to lean on CPQ for special deals. If CPQ managed to keep anything like their 97 margin structure, I would think that 'classic Compaq' would be in very good shape. It would be nice to have a big surprise next week, but we have to factor in the Digital high end business which may have suffered as a result of the merger activity. But in general this is pretty positive news. I would also look to IDC and Dataquest to add some good news on market share later in the month and into November. This is almost guaranteed since the 2Q numbers were screwed up by the channel inventory.