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Technology Stocks : Dell Technologies Inc.
DELL 125.97-1.0%Nov 25 3:59 PM EST
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To: Paul Reuben who wrote (8745)6/15/1997 11:28:00 PM
From: jbn3   of 176387
 
Paul

Another ComputerLand franchise owner, who spoke on condition of anonymity, said Compaq is going after Dell. "What they presented to us was that their corporate mission is to beat Dell at all costs," the source said.

After all the furor in the lower end market lately, now CPQ is going after DELL. This tells me

1. DELL has really been hurting CPQ.
2. Maybe CPQ has found a way to use up its 9 billion cash reserve by selling at or below cost.
3. Short term the profit margins of all the computer-makers are going to melt like a 4th-of-July ice cream cone.
4. With its systemic 12% production/sales advantage, DELL should be able to weather this nicely. GTW has less cash, may be more affected.
5. The declining profit margins may be balanced by increased sales, providing prices don't get too low. We may have heard the last of the "computer sales are declining" -- at least for a little while.
6. Computer parts and components production companies should do well.
7. Internet usage is going to increase geometrically.
8. Long-term, someone is going to end up with a lot of market share.
9. However, the US market may be fairly well saturated after an extended time period of fire-sale prices. There may well be a lengthy lag in US sales for a while.
10. International markets will be the growth potential of tomorrow.
11. DELL and CPQ are going to get bloody

I know I said I wanted a buying opportunity, but I didn't mean this! Somebody please tell me I'm wrong.

three
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