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Technology Stocks : Dell Technologies Inc.

DELL 125.96

-1.0%

3:59 PM EST

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To: Chuzzlewit who wrote (36704)	4/6/1998 10:44:00 PM
From: Ally	Read Replies (2) of 176387

>>One of the things that Dell critics have a big problem understanding is that as important as margins are, inventory turns are even more important in the tech sector. Suppose you have a 30% margin and turn your inventory 6 times per year. With all other things being equal you can achieve the same gross profit with a 7.5% margin with 24 inventory turns per year. Well Dell turns its inventory more than 52 times a year, and Compaq ... ?<< Dell still has to maintain inventory of the components.. mother board, power supply, ram, graphics, etc. wouldn't it? CPQ, IBM, and other pc dealers are also on to BTO and they maintain a minimum demos in the stores and configure to order for companies. Dell is still the leader though.

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