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Technology Stocks : Dell Technologies Inc.

DELL 118.98

+0.4%

1:00 PM EST

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To: Key West who wrote (46327)	6/8/1998 3:30:00 PM
From: Gabriel008	Read Replies (1) of 176387

Gene, just got back in from a fishing weekend & it's taken me over 2 hours to review the posts on the thread. The one I found the most interesting was the item on ASP's. In my opinion if the the ASP goes up 1% the incremental dollars go directly to the bottom line and generate an additional $43.75MM [based on 1.750 million units in Q2]profit or $0.0625 of incremental eps for Q2. There is no cost of sales associated with a marginal increase/decrease in ASP. The cost is only attributable to the units sold. You'll notice that in Q1 the ASP dropped approximately 4% with no corresponding decrease in GP or NPBT. This is due to component costs decreasing as fast as ASP's. If component costs decrease as quickly in Q2 imagine the positive impact on the bottom line with the ASP's actually increasing. Check out this post from Jim Kelley re ASP's; exchange2000.com

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