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Technology Stocks : Dell Technologies Inc.

DELL 146.68

-1.7%

Nov 7 9:30 AM EST

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To: Dorine Essey who wrote (153224)	2/8/2000 12:26:00 PM
From: D.J.Smyth	Read Replies (3) of 176387

Dorine, how does Warberg justify the SUNW model valuation against the Dell model valuation? SUNW is growing less than Dell in the enterprise arena and SUNW has 1/2 the revenue of Dell. Yet, SUNW is a buy and Dell is a hold. I know how they justify this; SUNW serves a different upscale market with different products. But what is to be said of Dell entering the same? Is it a given that Dell will forever serve the same audience with the same product utilizing the same strategies? The entire Dell phenomena was built on the addage of being able to quickly adapet internally once change was decided upon. Dell's earnings, even with their projected decrease, are still greater per employee, per firm, at Dell by over 50%. Dell's revenue per employee is $968,730. SUNW's revenue per employee is $441,972 - SUNW with 29,000 employees, Dell with 23,600 and producing 100% more revenue. Obviously SUNW sells higher margin items - but the comparisons relative to future growth and benefit are too obvious to ignore.

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