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

To: Mao II who wrote (53588)	3/16/1999 2:33:00 PM
From: Elwood P. Dowd	Read Replies (1) \| Respond to of 97611

Joe Kernan or one of the other guys on CNBC was discussing the following report today. El Tuesday March 16 2:23 PM ET Compaq CEO Bullish On Internet Stocks By Yuko Inoue TOKYO (Reuters) - U.S. Internet-related stocks are not overvalued, despite strong recent rises which many analysts believe are unjustified, the chief executive of Compaq Computer Corp (NYSE:CPQ - news) said in an interview. Chief executive officer Eckhard Pfeiffer told Reuters in Tokyo that the strength in U.S. Internet stocks was justified taking into consideration the future value that will be generated by the new industry. ''I don't think the Internet stocks are overvalued at all, frankly,'' said Pfeiffer, head of the world's biggest PC maker. Citing the ''enormous value'' the PC industry has generated for shareholders in the past 10 years, Pfeiffer said: ''That's the phenomenon we are seeing in Internet investment.'' Pfieffer's view is in contrast to that of many Wall Street analysts who have voiced concern that prices of Internet-related stocks have climbed far beyond their proper valuations on strong buying by individual investors. ''What we are seeing is the early positioning of those...brand new companies. They are trying to be way out ahead before practically everybody else will enter the market.'' Pfieffer also said Compaq was rapidly transforming itself into an information technology leader from a PC maker, which gave the company a huge advantage over rival Dell Computer Corp. (Nasdaq:DELL - news) Dell has been rapidly catching up with computer giants Compaq and International Business Machines Corp (NYSE:IBM - news) (IBM), posting strong sales growth in the past few quarters. ''We have positioned ourselves in the enterprise solution space with total capabilities, with the products, with the platforms, and with the services. That is something Dell cannot compete with,'' he said. ''Dell is obviously trying to put together the pieces but, if it ever happens, it will take a lot of time.'' Compaq employs 30,000 service staff worldwide following its acquisition of Digital Equipment Corp last year, which also saw it acquire the AltaVista Internet portal site. According to research firm International Data Corp, Compaq was the world's top PC seller in the fourth quarter of 1998, lifting its market share by a fraction to 15.3 percent. Dell was third, raising its market share to 8.4 percent from 6.2 percent. Before visiting Japan, Pfeiffer had been in China to open the country's first online bookstore in Beijing. While there, Pfeiffer pledged to invest $30 million in the Chinese market over the next two years, mainly to promote the electronic commerce business. ''The entire strategy for Compaq for the future is Internet leadership,'' he said. Amid growing concerns about a global downturn in PC sales later this year, Pfeiffer declined to comment specifically on the company's PC sale prospects for 1999. ''It's too early to say how the demand will actually develop,'' he said. ''We are basically optimistic. As the year goes on we'll see a normal pickup in demand,'' he said.