Darrell - Back when this thread was calling for DELL to maintain growth in excess of 40%, I was pointing out that they would need to do more than just follow in the enterprise space, and would need to be more aggressive in new markets as well, especially consumer, and some other "out of the box" category, which would force a shift in their traditional business model.
But with expectations reset around a 30% growth model, DELL can do their traditional thing in appliance servers, attached and network storage, and consumer products and still hit the mark, and they show every indication of doing so.
That is the reason that although I cut back my DELL holding somewhat, I still maintain it as about 10% of my core holding. They are still the best managed of the PC companies, and if they have determined that their path will be to maintain focus on their core competency, continue to leverage their business model, and accept the consequences of somewhat lower growth, and the street has supported the stock with that guidance, then I expect DELL to remain as a highly predictable investment, although not with the growth we have seen in the past. |
