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

To: jim kelley who wrote (56804)	4/13/1999 9:42:00 PM
From: Key West	Read Replies (2) \| Respond to of 97611

Jim, Intel's 0.57 dispels all doubts re a PC slowdown this quarter, as Mr. Pfeiffer would have Wall Street believe. There is no slowdown. Michael Dell and Tom Meridith were very upbeat last Thursday, as was HWP today. Intel didn't warn, and lo and behold 0.02 better than first call. Even Compaq managed to slip only 3% on the revenue front. THERE IS NO PC SECTOR SLOWDOWN, MR. PFEIFFER! Intel's earnings prove that beyond a shadow of a doubt. Furthermore, as we long suspected, and as a 50% drop in CPQ's earnings confirm absolutely, Compaq's problems are company specific. While Compaq's potential spinoff of AV is the wildcard that could save them in the long haul, WS will soon begin to realize that none of the box makers can compete with any long term success against Dell's perfect distribution model. Not IBM, (who aligned themselves with Dell to exit the PC sector eventually and save face), not HWP, and definitely not Compaq, whose limp management team oscillate helplessly and without direction between direct and conventional models. Compaq may well survive this current crisis, as did IBM a few years back, but not without major restructuring and possible wholesale changes at the top. As far as box maker against box maker goes, Compaq doesn't have chance, no more than IBM and HWP. Pfeiffer had us believe that Dell lost market share to CPQ in Q-4, and that CPQ was victim of a PC slowdown in Q-1. Today we know the latter was pure nonsense, and soon the markets will realize the former is just as ridiculous. Which leads to the question of how strong is the management team here and how capable are they of taking on Goliath? Gene Piccoli