Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Hobie1Kenobe who wrote (92020)	1/27/1999 10:23:00 PM
From: jim kelley	Read Replies (1) \| Respond to of 176387

JF3, Well the heat was on CPQ to produce the earnings promised. EP and EM would have been history if they failed to report the desired numbers. The cynical view is they stuffed the channels big time this quarter. The rise in inventory and A/R suggests they may get hit hard in Q1 and Q2. The problem of course is how do you define stuff for the auditors? The sale of the pony will help their cash position but it is no substitute for genuine operating earnings. Regards, Jim Kelley

To: Hobie1Kenobe who wrote (92020)	1/28/1999 2:47:00 AM
From: TechMkt	Read Replies (1) \| Respond to of 176387

Here's some interesting commentary on CPQ's numbers. Fez ___________________ Several Wall Street analysts found little to be excited about immediately following the earnings report, noting that the better earnings came not from fundamental growth in Compaq's businesses but from non-operating activities. ''The number looks OK,'' Gerard Klauer analyst Lou Mazzucchelli said. Referring to the transition over the last year as Compaq has moved to digest Digital, he said, ''I think they are trying to claw their way back.'' Still, he cautioned, ''I am not completely convinced they are out of the woods.'' Piper Jaffray analyst Ashok Kumar said revenues were roughly in line with Wall Street expectations, while the earnings surprise resulted in large part from higher-than-expected profit margins and a significantly lower tax rate. He said better margins added 2 cents per share to earnings, and the tax rate, which he estimated at 19 percent, down from 26 percent a year ago, generated another 2-3 cents. ''The quality of the earnings surprise is not that great, but basically you take what you can get,'' Kumar said. He said he would have been happier with the results if Compaq had shown growth in operations as measured in top-line revenues. ''If the surprise was top-line driven, it would be a different story,'' he said. Still, Kumar saw the earnings report as likely to push the stock higher. In early stock market trading Compaq shares rose $2 to $51.25, a new intraday high.