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Technology Stocks : Dell Technologies Inc.
DELL 124.09-3.0%12:14 PM EST
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To: Chuzzlewit who wrote (21415)11/13/1997 1:35:00 PM
From: Paul Merriwether  Read Replies (2) of 176387
 
<<So what are the expectations for Dell over the next few years? As I recall, Dell is
expected to earn about $3.60 next year and conservativel increasing by about 30%
for the next several years thereafter. So let's assume that in the year 2001 they earn
$7.91, and at that point they suddenly become mature, growing at only 10% per
annum in perpetuity. The P/E in 2001 would be 17.93 (in line with a company
expected to grow at 10% per annum), >>
Paul
I think you need to discount more than 15% in a volatile industry like
PC manufacturing. Who knows a year from now, you and I will be convinced that network pc is the way to go. Remember, DELL is not
a bakery(where people HAVE to buy food). Looking forward into the
year 2001 with Dell is not intelligent(imho).
And I did NOT say that Dell should be trading at a multiple of
10. All I said was that I would consider ti attractive if it were
trading there(and would hence I would consider buying it). At 89
a share it seemed VERY unattractive so I shorted. At 79 I lost the
stomach for it so I stopped. I now wish that I had kept my short since its at 70 now :(.
I have been following your posts and I know that you are diversified
into 12 companies etc and don't invest on borrowed money. Therefore
you should be OK. I, however am sweating my intc investment right now
:(
-P
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