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To: JRI who wrote (116237)	4/11/1999 8:43:00 PM
From: Gabriel008	Respond to of 176387

John, thanks for the kind note and the hospitality. We'll be back some time in September or October and, hopefully, have the opportunity to get together again. I might even make it to DELL's annual meeting in July but only if the stars are properly aligned. Best regards, Gabriel

To: JRI who wrote (116237)	4/11/1999 10:29:00 PM
From: Gabriel008	Respond to of 176387

John, the only surprise in Compaq's warning on Friday was the magnitude of the miss. And, oh yes, CPQ management knew they would miss well before the announcement but hadn't quantified the number until last week. I've been catching up today on postings & news. I'm coming to certain conclusions on how to play DELL options given my new set of facts and assumptions; 1- In the case of Compaq you don't experience revenue shortfall of approximately 3% with a corresponding profit shortfall of approximately 50% without some repercussions. As a result, I'm expecting Compaq to imminently announce [Q1 report April 21] a major corporate re-organization and re-engineering of their overall corporate strategy. 2- The announced DELL/IBM deal leads me to suspect that the recent statement by IBM that they are losing money in PC's is actually a carefully conceived plan to slowly but honourably exit the PC business within the next 12 months. Since I believe that DELL can only profit from the above changes I'll bump up my investment in January 40 calls. However, I'm going to wait until April 26 or 27 to do so. IDC reports Q1 PC sales April 23 and I'm expecting DELL to experience negative sequential growth of 3.5%because of the January effect [see my post to Jim Kelley March 15 Message 8327486]. As a result, DELL should dip after the IDC data comes out and this may present the best buying opportunity before the May 18 earnings report. regards, Gabriel