Hi!!
RE: Till now the best Dell said is 30% growth in earnings.
Not real sure about your math and certainly when I do some I would question anything.. :o)
Here is what I have to date:
1st qt. .16
2nd qt. .21
3rd qt. .22
4th qt. .26
This I assume if my calculator is right would be .85...
And since the first qt. is already in @ .19 we are now at a minimum of .88..This would be a 29% increase over 1999 if DELL just hits the estimate...
Well, so why am I so high on what they can do? I actually judge this company by their word and don't usually attempt to pull a number out of the hat...Ohhh yeah I cheated last quarter and used Patrick's number but then we both kinda "listen" very very very closely to some key words or indications that have usually indicated an uptick...Sure Patrick does the math with all that sequential crap and Drew has all this margin stuff figured out...I'm just sitting back here listening...Listening for words that I have heard for years...Words that are in the present tense and not future...I love the future and hold with this company because of what they say about the future but let's face it...They haven't let us down yet with their optimism...
Recently Don Collis told us "We are on the road to being the premier Internet infrastructure company? Don Collis 6/14/200
I like the positive tone of this...And, then there was the recent statements by Michael:
I EXPECT IT WILL BE A VERY GOOD YEAR FOR US. WE EXPECT, IN DOLLAR TERMS, TO , BY FAR AND AWAY, EARN MORE REVENUE THIS YEAR THAN IN ANY YEAR IN OUR HISTORY, I HAVE NOT SEEN ANYTHING THAT WOULD LEAD US TO BELIEVE THAT OUR MARKET IS SLOWING, IN FACT, SECOND QUARTER GROWTH FOR TOTAL INDUSTRY HAS BEEN THE MOST ROBUST IN THE LAST SEVEN YEARS.
In these two statements I find confirmation of goals they have been setting for shareholders...We are not talking here about the "old DELL"...They are talking about the "new DELL"...
So what's that got to do with estimates? I add .2 to every estimate that Michael Dell says is "ROBUST"...So, I added .2 to every quarter for the rest of the year...So, let's make that now .6 and a total of .94...
And perhaps this is low...Schneider has told us that the strength of the Windows 2000 for servers "increasing every week"...June 8th
Figuring also that corporate demand will really pick up in the second half my .2 may be low for the third and fourth quarters..Management has told us since the first of the year that the second half is where the real growth will be...
Then we have the guidance by Schneider who informed us at the conference call to "guide our estimates higher" for DELLVENTURES to the end of the year...So, I took that to mean that the .2cents that DELL made in the first quarter will be increased each quarter...And, seeing that we now have invested $800 million I'm inclined to think that the profitability will continue to rise just as he has stated it will...I then added .2 for the next quarter and .3 for the next two quarters bringing that total to .8 for the remaining three quarters...
Adding this all together I get $1.02...Seeing that we made $.68 last year that would be an even 50% for the year...
Let's also not forget that DELL has a lot going for it if some of the "if's" come through...Europe just being one of them...Convergenet another? Higher margin products?
BTW...You mentioned that DELL hasn't guided us forward yet on anything above 30%...Don't forget that it's "underestimate and then overachieve"...
Best, Kemble |
