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

To: Howard Feinstein who wrote (60000)	4/28/1999 2:50:00 PM
From: rupert1	Read Replies (2) \| Respond to of 97611

Howie: I realise I'm just a rhetorical sounding board for you and others, but just in case anyone takes it seriously, I do own other stocks. This is my "home" board and the one I cultivate partly because of some of the other posters and partly because I am interested in CPQ. Furthermore, as I have made clear since joining the board last July, I trade CPQ actively, although the current flat share price makes that difficult. You are right that the market needs good news from COMPAQ, and reassurance. It could come from a CC when Rosen is finally ready to guide analysts, or from market surveys, or new products, or restructuring, the announcement of a content provider for AV and, as you say, a new CEO. But all of those potential events could also bring less than positive news. Why would you wonder about interest in the company? Its stock is very inexpensive with a forward p/e well below its rate of growth. It is one of the biggest companies in the world. It sells close to $10 billion of dollars of products and services each quarter, it is interconnected with most of the major technologies and enterprises in the computer and IT industries. What did people who were in COMPAQ do this time last year when it was $23? Where they just as depressed? Since then it went to $38 before dropping back to $23 again and then onto $51 and now back to $23. On its last uptrend it moved between $35 and $27 many times.

To: Howard Feinstein who wrote (60000)	4/28/1999 3:13:00 PM
From: Racso	Read Replies (1) \| Respond to of 97611

I think the most attractive points that this stock has at this point , short of the potential positive news that Victor just outlined, is its cheap value relative to its expected growth rate. I run these numbers before today's opening and you can see how CPQ is the cheapest in its group, even less expensive than AAPL which just had a good run. What strikes me the most is how cheap it looks compared to its peers. It is amazing: 99 P/E : CPQ 21.4X VS AAPL 16.4X, DELL 59.2X, GTW 25.3X, HWP 22.8X, IBM 28.1X Price/Book: CPQ 3.6X VS AAPL 3.6X, DELL 56.1X, GTW 8.3X, HWP 4.6X, IBM 10.1X Price/Growth Rate [00 EPS/99 EPS]: CPQ 0.37X, AAPL 5.6X, DELL 1.7X, GTW 1X, HWP 2.3X, IBM 1.9X Relative to DELL, CPQ is incredibly inexpensive. I do believe that DELL does deserve a premium given its superior growth rate and increasing market share gains. But I don't think DELL is worth 16 times more (price/ book), 4.7 times more (price/growth) or even 2.8 times more (99 P/E). CPQ's current multiples do reflect an excessive lack of credibility in the company's prospects and long term viability. If you dispute this perception then you should consider buying this stock.