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Technology Stocks : Intel Strategy for Achieving Wealth and Off Topic -- Ignore unavailable to you. Want to Upgrade?

To: Frank Ellis Morris who wrote (22348)	1/11/1999 6:17:00 AM
From: puborectalis	Read Replies (1) \| Respond to of 27012

PC stocks may get a plug out of Y2K problem BY ADAM LASHINSKY Mercury News Staff Writer IN mid-October -- what we now know was the trough of the market for tech stocks -- nearly every analyst who mattered was bearish on prospects for the rest of last year and this one. An exception was Michael K. Kwatinetz, technology research director for Credit Suisse First Boston Corp. in New York. Kwatinetz, a former software entrepreneur, didn't see the slowdown others saw in the growth rate of personal computers, he didn't see tech stocks staying down, and he wasn't overly concerned about the investment ramifications of the year 2000 computing problem. He was right about the first two key metrics, and he isn't backing down on the third, the dreaded Y2K problem. ''It's going to be a positive for the PC sector, which in turn will drive a lot of other sectors,'' says Kwatinetz, who recently began his annual three-month sojourn in California (talking point: Can someone who leaves an office in Manhattan every winter for one in Palo Alto be dimwitted?). Kwatinetz can -- and does -- go on at length on why Y2K doesn't frighten him. But here is his thesis in a nutshell: Large enterprises with massive, outdated equipment have been fixing the problem for months. Any effects of their slowed spending has been felt. On the other hand, ''trailing-edge'' corporations and the government, as well as techno-challenged consumers, have put off PC-oriented upgrades for years. A significant portion see an ill-defined Y2K problem as a reason to step up their purchases of PCs. And they have plenty of time. ''What's the lead time to replace a PC?'' Kwatinetz muses. ''One day or so.'' The result is healthy PC purchases by bigger corporations completing their overall upgrades in the first half of the year and brisk activity by the upgrade crowd in the second half. ''There's a segment of the market that doesn't replace their PC very often,'' says Kwatinetz, who's not one of those people. ''I know analysts who still use DOS versions of Lotus spreadsheets.'' Many of these PC users have equipment that is not Y2K compliant. Computer aficionados know, of course, that it probably doesn't matter that someone toiling with a notebook computer running Windows 3.1 on a 486 processor (like this columnist) doesn't need to be Y2K compliant. That's because it's unlikely they'll be running applications where the clock is crucial. But a significant number won't know that. ''The problem is that figuring out if it matters is complicated and potentially expensive,'' argues Kwatinetz, who has made a career recommending stocks like Dell Computer Corp. (Nasdaq, DELL) and Microsoft Corp. (Nasdaq, MSFT). ''So the question is, Will they be too scared to not replace their PCs? I think the answer is yes.'' Kwatinetz sees Dell being a particularly big winner because of its reputation for top-notch service. He also suggests -- but can't prove -- that Dell's gonzo customer, the U.S. government, already has told the direct-build king it will be upgrading PCs in massive amounts this year. Kwatinetz is the kind of analyst who isn't afraid to stick his neck out on non-tech subjects just because he knows nothing about them. He suggests the killer Y2K investment could be food. Food could surge because the apocalyptically inclined will begin hoarding staples at the end of the year. Hoarding means inventory buildups and increased sales. Think of it as channel stuffing by the customers. ''How important is an extra week of inventories?'' he wonders, suggesting makers of basic commodities could have banner years. Never mind that first-quarter sales would decrease commensurately. Wall Street will be too busy looking at the spectacular fourth quarter. ANALYZE DIFFERENT: It took Richard Nixon to go to China, Ronald Reagan to deal with the Russians and Kwatinetz to upgrade Apple Computer Inc. (Nasdaq, AAPL) Kwatinetz, a perennial Apple bear, changed his recommendation

To: Frank Ellis Morris who wrote (22348)	1/11/1999 10:38:00 AM
From: margaret tasset	Read Replies (1) \| Respond to of 27012

Good morning Frank, Sonny and all, Monday January 11, 9:50 am Eastern Time Lehman Ups Intel Target To $180/Shr From $135, Keeps As Buy (This is a headline-only alert, although it will likely be followed by an article soon) Wow, Intel is doing great this morning. Have a great day. Warm regards, Margaret

To: Frank Ellis Morris who wrote (22348)	1/11/1999 1:10:00 PM
From: Sonny McWilliams	Read Replies (1) \| Respond to of 27012

Frank. AOL. I guess you are happy today. Target has been raised to 195. One money manager is raising his allocations in stocks from about 70 to 80%. Sonny