Jim, your argument makes no sense. Suppose we take the high price before the correction in 1995 as an example. If you bought at $12 three years ago, the price would have appreciated over 1,000%, or to put it into perspective, 121% per annum. You could perform similar calculations on any of the other peak to peak calculations. Now, suppose you are right, and DELL corrects by 50% giving us a price of roughly $66 (pre-split). Had you bought at the peak in 1995 you would have realized a 442% gain, or, on an annualized basis a mere 75.5% rate of return.
There is no doubt that DELL is a volatile stock. That's reflected in its high beta. It is also a high growth stock, and that is reflected in its extraordinary growth in revenues, earnings, and earnings per share. And that, my friend, is why people like me invest in DELL.
Regards,
Paul |
