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

To: rupert1 who wrote (56160)	4/9/1999 7:56:00 AM
From: rupert1	Respond to of 97611

DELL and COMPAQ . Media comment. Courtesy of helpinout. Is All Really Well With Dell? Nightly Business Report, Thursday, April 08, 1999 at 21:34 SUSIE GHARIB: Three big new records on Wall Street today. The Dow moved in on 10,200, and also new milestones for the S&P 500 and the NASDAQ. The surge came from another wave of buying of Internet and tech stocks. But Dell Computer wasn't one of them. And that's even though Michael Dell was in New York today saying all is well with Dell. Here's Scott Gurvey with more. SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Michael Dell had fences to mend as he met with analysts in New York. Wall Street had been disappointed with the performance of Dell in the fourth quarter, and the stock was punished accordingly. It has been recovering in the last few weeks amid growing optimism about the state of personal computer sales. The company does not give specific guidance on future earnings. But in a session attended by hundreds of analysts, the company did say personal computer demand remains healthy and unit sales are expected to grow 14 percent annually through 2001. The Internet and high-speed web access from home will drive growth. And the services business, which Dell has traditionally outsourced, will be a new focus for the company. There were also many questions about low-cost computers, a market segment Dell has been slow to enter. The company now has a $999 model which it says is profitable, and a new consumer division to address that segment. PAUL BELL, SR. VP/HOME & SMALL BUS., DELL COMPUTER: It was about two years ago that we announced that we were really entering the personal computer space for consumers and it's been very successful for us. We've grown at over 80 percent each of the last two years and are profitable in that business. And that's giving us the ability to reinvest in service and support and quality. GURVEY: But sustaining high rates of growth as the company matures into a maturing industry seems to some an almost insurmountable challenge,especially when the other industry leaders sport far lower multiples. KEVIN McCARTHY, TECHNOLOGY ANALYST, DONALDSON LUFKIN & JENRETTE: They still have the best model but it's not... it's not clearly ahead as it used to be. I think Compaq (NYSE:CPQ), IBM (NYSE:IBM) and HP (NYSE:HWP) have closed the gap to some egree, and I think the overall the industry growth rate has slowed this year. You're seeing it with the software companies having problems right now and I think some of those Y2K concerns will pop up later this year. GURVEY: The official word on Dell's first quarter won't be known for several weeks. The company expects to report earnings on May 18. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.