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Technology Stocks : Dell Technologies Inc.
DELL 126.59+0.1%3:59 PM EST
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To: Jim Patterson who wrote (48136)6/18/1998 5:29:00 PM
From: Chuzzlewit  Read Replies (1) of 176387
 
Jim, for once I agree with you! You have precisely defined the risk. That's why this endless nonsense about ASPs wears thin. The real point is can Dell continue to grow at a rate consistent with its price. This is not peculiar to Dell. It is equally true of every growth stock. The bulls obviously think it can. So far, there is no indication that sales growth is declining. In fact, it is beginning to look as if it may actually be accelerating or at least poised to accelerate. Consider these developments:

1. Dell announces entry into the mass storage business based on Data General technology;

2. Dell is building new plants in South America, Europe and Asia;

3. Notebook sales are up 104% year over year;

4. Dell reports that business is brisk.

Now, what are the negatives? There is only one that I can think of. IDC (or was it Dataquest?) forecast only 9% growth in unit sales.

As you can see, all of the negatives are based on conjecture or misinformation. People like Techie spreading rumors about lost business. People like LT who think the economy is about to implode. People who don't understand microeconomics and who think that falling component prices is bad.

I am a bull because I see no tangible evidence that Dell's growth is faltering or in danger of faltering. I am a bull because I see a business that is run peerlessly using any financial parameter you wish to point to.

TTFN,
CTC
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