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Technology Stocks : Dell Technologies Inc.

DELL 129.25

+0.6%

Dec 26 3:59 PM EST

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To: K. M. Strickler who wrote (48403)	6/21/1998 12:10:00 AM
From: Techie	Read Replies (2) of 176387

K, yes Dell will lower ASPs and maintain profit margins. But if they don't gain market share BIG TIME, it won't be enough to keep them on the growth path they (and you) got used to and that would mean shrinking P/Es. I was too lazy to go dig up my notes for Meathead (he doesn't deserve it) but here is MD's exact words: "Declining costs have positive and negative affects. If you can sell them UP it's ok. But at the rate the components are declining there is almost no way for ASPs not to decline". By UP he means a higher end machine. As for the lower wafer starts. No, it's not because of changes to process or anything like that. Ask Ronald Norris (President of TSMC USA), he'll tell you. It's lower unit demand all right and it only surfaced this quarter.

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