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Technology Stocks : Dell Technologies Inc.

DELL 127.92

+0.4%

Dec 30 3:59 PM EST

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To: K. M. Strickler who wrote (37421)	4/10/1998 11:24:00 AM
From: Lucretius	Read Replies (7) of 176387

KM, I think you put forth valid concerns. Here's how I see it.... "Dell Computer Corp., which built a huge business on its reputation as a low-priced computer seller, said it wants to move away from its discount-price image" DELL made their name in out-pricing and out-servicing the major players. Now that others are dropping their prices, DELL is losing that advantage so they are trying to find a new niche' in the high end mkt. I think this is a mistake. "You dance w/ the one that brung ya." Why didn't the stock leap yesterday w/ Michael and the PR crew firing the big guns? Weak vol and sold off below the open? I've never seen DELL act this weak before. Goldman left their rating unch'd and didn't raise numbers? The other analysts made no comments? The action in the stock is telling us something. Earnings for the current qtr will likely be fine, but I have serious doubts about the rest of the yr. Like I said, I have been hearing from some of their suppliers that DELL is pushing back orders (DELL uses a JIT system so this is where a slowdown would be seen first). I believe this new push into advertising and the high-end mkt are a warning shot across the bow. DELL is finding it harder and harder to continue growth w/ their current model so they are adjusting to what they believe will solve this problem. I don't think so. A lower price sells more boxes, period. Advertising expense will now reduce margins as well. Just my thoughts.... Good Luck! -Lucretius

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