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

To: PCSS who wrote (42694)	1/8/1999 1:49:00 PM
From: Night Writer	Respond to of 97611

PC Sales Drive Online Gains The Motley Fool - January 08, 1999 12:18 January 8, 1999/FOOLWIRE/ -- PC sales were hot in December, according to PC Data of Reston, Virginia. The Wall Street Journal's citation of PC's Data's release said that PC unit sales in December surged a wicked 41%. Before going on to what that means for PC companies themselves, let's consider what that means for companies selling complementary products. First, America Online (NYSE: AOL). From its recent press release on membership numbers: "The Company said its growth from 14 million to 15 million members was the fastest addition of one million new subscribers in its history. On Christmas Day alone, more new members joined AOL than on any single day in the company's history." Causal link? You bet. Is this a reflexive phenomenon? Yes, the network effects are self-reinforcing. With more members on America Online, the service becomes more valuable at an exponential rate to the number of new subscribers that have been added to the network. Yahoo! (Nasdaq: YHOO), for one, is also benefiting from this news, gaining $27 to $347 this morning. Excite (Nasdaq: XCIT) gained $7 15/16 to $ 63 1/4. Amazon.com (Nasdaq: AMZN), a company that by now everyone should realize benefits from very strong network effects, gained an incredible $5 billion or so in market cap this morning by rocketing ahead $27 1/16 to $185 15/16. CNET Inc. (Nasdaq: CNET) added $7 3/8 to $63 3/8 while a sort of kissing cousin, CMP Media (Nasdaq: CMPX), ticked down $1/8 to $18 1/8 -- which is kind of strange, because when you think of the developments I'm talking about here and when you look at how well run this company is, you would think the market would put a higher value on it. Infoseek (Nasdaq: SEEK) gained $4 1/8 to $57, as well. Infoseek is the parent of Starwave, which produces ESPN.com, ABCNews.com, and the NBA, NFL, and NASCAR websites and is linked up with Walt Disney (NYSE: DIS), the de-facto parent of Infoseek itself. Back to the PC companies. Pretty much all the OEMs are having a so-so day on the news. Compaq (NYSE: CPQ), Dell (Nasdaq: DELL), Hewlett Packard (NYSE: HWP), and Apple (Nasdaq: AAPL) are up slightly while Gateway (NYSE: GTW) is down a hair. Some may ascribe this to a 20% year-over-year decline in average selling prices, but as we've said here too many times to count, the PC industry is naturally deflationary. Negative 20% inflation is just nothing new for these companies and is not bad news in light of the fact that component price disinflation is just as powerful a force a force in the dynamics of the PC industry. As I posited last night, faster asset turns, price declines, and margin declines are the natural driving forces in the present economy. The sooner CompUSA (NYSE: CPU) really embaces this, the sooner its stock will move up. CompUSA was down $9/16 to $14 1/16 this morning, by the way. -- by Dale Wettlaufer

To: PCSS who wrote (42694)	1/8/1999 1:55:00 PM
From: Night Writer	Respond to of 97611

Michael, My charts aren't working. I can get real time only one quote at a time. CBOE is telling me that it can't find the CPQ symbol, so I can't tell what is happening to my options. Many internet queries are returning a server busy or URL not available message. I think part of the net is overloaded. NW

To: PCSS who wrote (42694)	1/8/1999 1:57:00 PM
From: Night Writer	Respond to of 97611

ECONOMIC NEWS: TODAY, January 8 ** The U.S. UNEMPLOYMENT RATE fell in December and payroll employment grew at its fastest rate in more than a year as unusually warm weather in the early part of last month led to a surge in construction jobs, the government said on Friday. The unemployment rate fell to 4.3% from 4.4%, the Labor Department reported. DECEMBER NON-FARM PAYROLLS climbed 378,000 on a seasonally adjusted basis, the largest monthly gain since September 1997, when payrolls grew 386,000. December's payroll rise followed a robust gain of 251,000 in November. The report was much more robust than U.S. economists in a Reuters survey had expected. Economists, on average, had projected jobs growth of 212,000 in December and a slight rise in the unemployment rate to 4.5%. See infobeat.com