Mohan,
About Dell & Y2k;
- I agree with Watchtowers posts,
- Dell is a relatively save investment,
- The real risk for Dell (and almost all other stocks) is that there
is a very serious chance the Y2k-problem will turn the world into
a depression
There are 3 kind of stocks IMO
- the risky ones, like banks, insurance companys etc (lots of old
code),
- those who will profit, IT-services companies, Y2k-stocks (the
people (body-shopping etc) are gonna make the money, Y2k-software
is not were the money is because there are no silver bullets)
- others, like Dell.
I asked a guy at PHG how they are managing the Y2k-problem. Answer
was; you don't want to know,
I asked the guy who is responsible for solving the Y2k-problem for
the dutch railways how they are managing the Y2k-problem. Answer
was; you don't want to know,
I asked a guy who is project-manager for a major warehouse in Holland
who they are doing; answer was; you don't want to know,
I asked a guy who is responsible for the service-practice Millenium-
service from Origin (PHG-related IT-company) was his opinion was;
answer; you don't want to know.
I'm 100% sure that still most of the people (and investors) are
heavily underestimating the problem.
Personally I'm hedging my portofolio already with major IT-services
companies in Holland because the are all have earning-growth of 50%
or more in the last few years and will continue to do so in at least
the next 5 years. (All major IT-companies at least quadruppled in
the last 1,5 year)
5 years of 50% earnings-growth means earnings will rise over 400% in
this period. That makes them a very, very save investment.
Those who expect these companies will plunge after 1 jan 2000, forget
about it. It will take years to clean up all the mess.
And these companies don't need the Y2k-money to grow. To many trends,
(e-commerce, the euro, delayed projects because of Y2k etc.)
And there is already a tremendous shortage of IT-people.
So no matter how high PE is, stock-price will continue to rise
spectacular.
Look for comparable companies in the USA like CHRZ, KEA (thanks Hank)
Paul |
