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Technology Stocks : Dell Technologies Inc.

DELL 133.18

-0.1%

Nov 28 12:59 PM EST

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To: D.J.Smyth who wrote (161380)	10/2/2000 9:26:55 PM
From: Meathead	Read Replies (1) of 176387

Here's how to get the stock price up. Dell needs to spin off the desktop division. Current shareholders will get .316 series D shares and .684 series E shares for every Dell share owned. This is based on .95 in earnings where desktops earns .30 and enterprise earns .65 per year Series D shares are a desktop company with 16B in annual revenue, 10% growth rate, and .30/share in earnings. What's that worth? With a PE of 20, about $6. Series E shares are an enterprise company also with 16B in annual sales but has a growth rate of 57% and about .65/share in earnings. What's that worth? Probably more than Sun or Cisco's PE but we'll give it a conservative PE of 2X growth at 114. That's $74. (74.684)+(6.316) = $52.50/shr No telling how high the street might bid up a company with 16B in annual revenue growing at 57% per annum. Amazing how the sum of the parts can be worth more than the whole. Go figure. MEATHEAD

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