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Technology Stocks : Dell Technologies Inc.

DELL 126.41

+2.8%

Dec 19 3:59 PM EST

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To: kemble s. matter who wrote (170983)	9/25/2002 11:57:24 AM
From: kaka	Read Replies (1) of 176387

6:39am 09/25/02 Brokers see threat to H-P in Dell's Lexmar deal (HPQ, DELL) By Emily Church Dell Corp.'s (DELL) production deal with Lexmark could represent a risk to Hewlett-Packard (HPQ) over the long-term, two brokers cautioned on Wednesday. "Over the near term, we believe the agreement will be a neutral for Dell, as well as for industry leader Hewlett-Packard. We believe the product rollout will occur gradually, and, in our view, preliminary market share gains will come from smaller players in the industry," JP Morgan said. "But longer term, we believe this may represent a risk to H-P's primary source of cash flow." Credit Suisse First Boston told clients that "Since consumables will be sourced from Lexmark, Dell's profit on consumables will likely be lower than that for H-P... Since HP makes 55-60 percent gross profit on its consumables and uses those profits to fund an unprofitable computer business, Dell's entry into the printing business could be troubling for HP over the longer term."

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