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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: Ed Zhao who wrote (43290)	5/19/1998 3:31:00 PM
From: Chuzzlewit	Read Replies (2) of 176387

Ed, I'm not sure I understand the point you are trying to make. I view a company as a black box that spits out cash. The value of that black box is not determined by what the wood or black paint cost, but the value of the net cash stream that that company is likely to generate in the future. In that respect it's no different than a zero coupon bond. The problem is the uncertainty with regard to future cash flows. It is obvious that the market as a whole believes that the present value of those Dell's cash flows is twice that of Matsushita. This analytical framework has nothing to do with historic costs, profit margins, cash on hand, total sales, etc. It is simply based on cash. This is the same framework David Stern was using. My post simply pointed out what I believe to be the flaws in his assumptions. I am sure that David would concur that we agree in the philosophical approach, but disagree in the assumptions. TTFN, CTC

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