To all:
I'm short Dell since 111, and more at 135. I have been in the computer business for 14 years now. I'm not here to bash dell as a short who is against the longs. I try to trade without emotions. I have over 7 figures in other stocks and I am short Dell a bit under 6 figures. .
In my entire trading history, which is 13 years, I have never seen such bullish feverish talk about a computer company. I cringe when I read people upset with 25% a year returns and switching funds for daughters and sons from mutual funds to stocks so that they can make 200% a year or more. Don't jeopardize the future of your children over a box company.
Here is fundamentally why I am short dell:
The Asian crisis is not over. It is going to hit big time in early April or so. (After the end of tax year for Japan and Japanese banks stop supporting Asian markets.
Warning season is just around the corner. If there was any impact from the first Asian ripple it is going to be felt in this quarter, not the last quarter.
Dell boxes are becoming pricey for the corporate market place (which is what I sell to) The Delta between the Dell price and that of competitors is becoming too wide. I have many customers who have switched from Dell to "try" other brands because they were so much cheaper now.
The under $1000 PC and the $499 NIC computer are reality. Talk of ISP's developing plans for $29.95 internet service with a free NIC computer will happen this spring.
A shortage of an inventory part would "shut" down Dell because they only carry 7 days worth of most parts.
The Japanese will attack like Pearl Harbor,,,,,,they will flood our shores this spring with low costs computers from NEC, Toshiba, Sony and Mitsubishi. They have a huge price advantage because of the exchange rate.
Market cap of over 50 billion???? Book value of 3 bucks???? I don't need to explain this one.
Gateway opening Country Store outlets in major cities. If they are successful will put a big dent in Dell Strategy.
Possible purchase of national integrator,,,,Data General has been mentioned. If this does happen days of high growth are history.
If Dell doesn't buy national integrator......Days of surviving in corporate world without the help of channel will end....Dell will need to be positioned as a full service integrator, (integration support, lan-wan design and implementation capability to compete with CPQ, IBM. if they are going to be successful in the corporate market place.
If Dell is going to survive as "just a box maker" they are going to have to compete in the under 1k PC business which spells LOOOOWWWW margins.
Anyway I cut it I can't find a reason to go long this stock fundamentally. (I've always been a top rep in this business and grew and sold a company to a larger PC company to make my big bucks.)
For all of you longs out there be easy on me, I work too hard and am too tired to get into any low blow arguments. I refuse to post any messages on the Yahoo Dell chat because it is such a Michael Dell Fan club where debate from either view point is always attacked personally.
Take care,
Phillip |
