Kemble: Throughout the weekend I will share some highlights from SG Cowen's Outstanding New Report on DELL -- issued on June 17th. Check out this passage by Richard Chu (Who has a BUY on DELL)...
<<..Why Should Investors be Interested in DELL?
The first reason is that DELL will likely continue to gain significant market share; we recognize that there are real limits to this argument, but it is just as important to understand that we are nowhere close to those limits. We estimate that DELL's global unit market share in calendar 1998 was on the order of 8.4%; we assume that it will lift its share to about 10.9% on C1999 and perhaps 13.3% in C2000. Assuming that DELL's value proposition remains intact (more on this later), surely it is plausible that DELL's market share can still build further to the high teens in another 3 years. The increasing importance of the internet and e-commerce transaction mediums, in our opinion, will exert tremendous pressure on all PC vendors to evolve their business models. There is no question that DELL, with its direct model, is far better positioned to leverage the internet, as a customer acquisition/retention medium as well as a transaction/execution medium, than any of its major indirect competitors. For DELL, the internet is largely a win-win proposition where supply-chain and demand-chain relationships can be maintained largely intact even as revenue potential is enhanced and costs are eliminated. For DELL's indirect competitors, however, implementation of new models, at the margin, typically requires some dislocation in existing relationships. Since time is of the essence, we see this as an opportunity for DELL to widen its market share gains at a potentially more rapid rate.>>
Hmmmm.....Sounds like one of the wiser analysts realizes that DELL still has a tremendous amount of potential <G>.
Best Regards,
Scott |
