"lack of future direction"
seems dell headed in right direction to me. what about a put purchase so you can maintain long position and be protected on downside? price of dell options have come down (reduced implied volatility recently).
regards
> THE BULL MARKET REPORT WEEKLY, JUNE 13th, 1999
> Volume 19, #9w
> PART ONE
> $$$$$ DELL COMPUTER MOVING TO EMBRACE THE
> INTERNET!
>
> In a news release, Dell Computer said they
> transitioning their entire business
> from a direct physical model to a direct
> Internet model, according to Vice
> Chairman Kevin Rollins. He said that the
> Internet offers the opportunity to
> potentially double the advantages realized by
> the direct sales model. They want
> to use the Internet to conduct electronic
> commerce and to provide support
> services to customers; to use the Web to work
> with suppliers; and to use the
> Internet to manage Dell's internal
> infrastructure. He added that the company is
> "one third of the way there" on each of these
> initiatives.
>
> COMMENT: We had to read this a couple of times
> because we thought Dell was
> already there. Obviously they are NOT already
> there but are moving rapidly in
> that direction. If they are only a third of
> the way there, and they are as
> successful as they are now, just think where
> this company can be when they are
> two-thirds of the way through this process.
> This is called mind-boggling.
>
> =====================================================================
>
> $$$$$ WHY WE LOWERED OUR TARGET ON COMPAQ
>
> Yesterday we lowered our 12-month price target
> on Compaq from $44 to $31. The
> progress Compaq has made has been dismal and
> they just announced that profits
> may not meet expectations again, for the
> current quarter. Dell is kicking their
> butt in marketing PC's and their market share
> has been dwindling. We have been
> so patient with this firm, but maybe we have
> overly so and we should just lick
> our wounds and move forward. This is a choice
> you just might want to make for
> yourselves. We still feel that the firm will
> figure it all out someday and
> begin to get back on the path to profitability
> and continue as one of the
> fastest growing companies in business history.
> They have a phenomenal marketing
> system in place now. They are not on the Net
> to any extent but if you want to
> buy a system from a store and actually touch
> and feel the product, you will
> probably run into Compaq. The Net business
> will come in time - it is never too
> late. So for the time being we will sit and
> wait for management to turn things
> around. We'll just have to lower our
> expectations and have patience. You may
> find that you are not willing to wait, and of
> course, there is a risk of
> waiting, since we don't know if it ever will
> come back.
>
> |
