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Technology Stocks : Dell Technologies Inc.
DELL 133.35+0.1%Nov 28 9:30 AM EST
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To: James Fink who wrote (35492)3/25/1998 12:17:00 PM
From: Chuzzlewit  Read Replies (2) of 176387
 
This was a very interesting article, and it made some major points which, while true, I believe Jubak misinterprets.

His major thesis is that computer sales have suffered because consumers don't have a compelling reason to upgrade. I think this is true. But I think that is the very reason that makes this sector such a great investment. Because there will come a time in the very near future when new applications will provide a very compelling reason to upgrade. I leave it to the technical types out there to identify those emerging applications.

And, of course, we have the second factor. The greatest number of computers are sold by local box shops. Dell's immense advantage in cost will continue to narrow the price gap, or in fact make Dell cheaper than these "white boxes".

I see the confluence of these two phenomena as extraordinarily bullish for Dell because they provide that hidden upside that all investors love. And, I haven't even talked about China!

The one final point that Jubak makes I am in total agreement. The communications industry is like to outperform the computer industry for the forseeable future. I agree, and that's why I hold companies like LU, TLAB and ATI in my portfolio. But this should not mean that DELL does not continue to represent an outstanding opportunity, and the stock could well outperform its telecommunication brethren. Why? because there are no "white box" vendors in the telecommunications arena.

Regards all,

Paul
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