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Strategies & Market Trends : Value Investing
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To: Harshu Vyas who wrote (74787)1/6/2024 10:58:29 AM
From: Elroy2 Recommendations

Recommended By
Sean Collett
Spekulatius

  Read Replies (2) of 78476
 
Dell trades at about 14x average earnings and about 9x adjusted free cash flow.

Dell sell tech hardware. That's very low growth. PCs and peripherals are mature.

14x seems about right, but Dell probably grows EPS by 4% per year over the next ten years, if that.

It's in tech, but it's not a growth stock. It's probably slower growing that most tech stocks.

Dell was great in the 1990's, when PCs were new, and everyone was buying them. Now it's just super efficient in a hyper competitive low margin sector.

Do you know the gross margins on PCs are about 5%, and probably less?

I can't imagine why anyone would want to invest in boring mature Dell, regardless of the valuation. Find something exciting......

Sorry, thumbs down!
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