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Technology Stocks : Dell Technologies Inc.
DELL 126.42+2.8%Dec 19 9:30 AM EST
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To: edamo who wrote (165544)5/24/2001 9:14:35 AM
From: Sig  Read Replies (2) of 176387
 
Generally I have very little disagreement with the way Dell is doing things.
1. Using options for years to enhance earnings and reward employees gave Dell huge cash supplies when growth was most needed to meet demand and TM was certainly the 'best man' for the job. In this time of
economic stagnation, and with a much larger company there is no need to take the risk in selling calls and puts
Dell still buys back shares to avoid stock dilution instead of using treasury shares to reward employees
which indicates management considers that reinvesting cash in the co is a good idea and will pay-off in the end.
2. This is the first year of a Dell layoff- something Michael is not familiar with and decidedly unpleasant. Using the experience of board members like Vanderslice and Topfer I expect MD to keep an eye on the end-game and
do it in such a manner and completness as to not have to repeat it 6 months down the road.
3. Success breeds success. Intc, Dell and Msft seem working together even more as team now, to get out the new products this fall in a timely manner and liven-up the PC industry.Bears talk about delays, IMO there won't be any. Intc will remember what happened to the Rdram and board defects, and Dell has taken care of the LCD
suppliy problem. Testing will be more thorough.
4. IBM and Dell can co-exist to the profit of both. The big blue boxes are still needed, but the quantities are small.
relative to the game Dell likes to play. And Dell will need the exotic disk drives produced by IBM.
Dell has contracts for $26 bil of supplies from IBM Experienced IBM members on Dells board will keep
things running smoothly.
5. The barriers to entry in the PC market are doubling. The game for white box manufacturers will get much tougher, and in fact they may have to buy parts from Dell (G)
.6. Predicting an end-game for Dell is interesting venture- not sure there is a valid precedent Ford is just a start.
It hinges on the world needs for computers and also Web-related items and digital communications of any form.
This is the first year Dell has been able to meet the demand for their computers, perhaps it is time to
venture out and pick some low-lying fruit in another related field.
And you know what the bears will say about that..Newby, desperate, too tough competition(G)
Sig
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