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

To: William who wrote (4888)	4/8/1999 5:43:00 PM
From: J R KARY	Read Replies (1) \| Respond to of 8218

PC Group VP: "IBM's 4Q98 PC business up 48%" , promoting services Not in conflict with LVG's "PC not in our future" , but clarifies IBM's PC marketing as a device for larger sales : " IBM will continue to provide our customers with the highest-quality and most technologically advanced products this industry has to offer. We will continue to bring manageability and security features to our PC lineup, adding to IBM's industry-leading role as the best vendor on total cost of ownership issues. " " Even in those circumstances, our sales to end users accelerated every quarter, growing 43% in the fourth quarter of 1998. In addition, our sales of personal computers enabled IBM to generate revenue and profit in the associated businesses of services, storage, displays, software, microelectronics and financing. " pc.ibm.com Maybe the PC baits IBM's multi-faceted product/services "hook" ? Jim K.

To: William who wrote (4888)	4/8/1999 6:49:00 PM
From: Arrow Hd.	Read Replies (1) \| Respond to of 8218

Something will probably change for the reasons you state. It is over-funded and could contribute nicely in the 4th quarter or 1st quarter 2000 if there is the expected data center freeze and/or 1st quarter business disruption. For those within five or so years of retirement there will options because the new style of plan is level and does not recognize years of service therefore, older employees would get screwed if they had no transition. IBM is very interested in retaining older employees since the ones still left survived every downsizing and represent enormous institutional knowledge. The brain drain in the next two years will be a major problem. I guess it is time for the quarterly guess on earnings, etc. This is only for fun. Early in the quarter I suggested that due to the second half data center freeze that there would be the mother of all fast start programs put in place which is what unfolded. The question became how it would work out. Could IBM's sales force overcome all tradition regarding lethargic first quarters and drive new business volumes so that the business could start to achieve the 60% of the business required assuming a second half slowdown. And how would customers accept this push knowing they buy heavily in the fourth quarter and need to rest and digest this activity. To incent the above quotas were probably set very high. It is not clear to me that the plan was executed with the type of precision hoped for though I have nothing to base it on other than comments made by analysts and other wall street types. The Morgan Stanley analyst flamed IBM on the Friday of March options expiration sending everything in the tank by calling for a 30 some percent chance of a pre warning from IBM and lowering his 12 month target. No one of significance followed his lead though I was expecting that would happen. The reason I see no warning is that they still have the financial clout to buy in stock and make the quarter. The concensus came down only a penny after the MS blast and I think the concensus is right on at 1.41 so no miss and no upside surprise. Revenue is hard to figure. Missing quota, if in fact some business areas underachieved, is a misleading indicator. If quotas are very high to drive an exceptional quarter then even a miss may be 10 to 12 points higher than the first quarter 98 on a year over year basis so an analyst hearing tales of woe from marketing contacts may be mislead if he doesnt know the uplift story. Anyway, price attrition raised its ugly head again across the entire IT industry so we need to be braced for single digit revenue growth which may turn the street off for a few trading sessions. So lets say 6%. Once the numbers are out and they are digested I think we will see a strong Spring: product announcements to refresh the lines, strong annual meeting, stock split and Gerstner's May 12th analysts meeting which will probably focus on E@Commerce and why IBM is the premier Internet company (and we are profitable). So 110 post split by July. Out on a limb here again with these guesses so be kind. Anyone else have a guess to share?