Some Great ZDNet comments on DELL..
<< "Given Dell's management track record, it's a pretty good bet they will find new growth," said Phil Rueppel, vice president at BT Alex. Brown.
Company profile: Dell Computer
Mr. Rueppel expects the company's revenue increases will slow to a 35% to 40% annual level. The reason it cannot sustain the 50% annual increases is that the market has consolidated among fewer and better-run companies. "My sense is the PC industry is just getting more and more competitive."
Dell has an advantage, however, with its Internet sales, now running at a $14 million-a-day rate. As part of its effort to use the Internet more, the company is also revamping its service operations to allow customers to search its Web site (www.dell.com) for answers to common problems -- and converse with other Dell customers for potential remedies.
The new approach should allow the company to service more customers without having to rapidly increase its service force. In the past, the company has said it avoided low-cost PCs in part because novice buyers who tend to purchase lower-cost machines added inordinately to service costs.
Vadim Zlotnikov, senior technology analyst at Sanford C. Berstein & Co., says the company's investments in Internet-based self-service can reduce the costs associated with selling to novice buyers. "They felt the spending on information systems, on an Internet site has reduced the cost of serving these customers. If this is true, and they believe it to be, an incremental sale is incremental profit," he says.
Mr. Zlotnikov expects the company to reignite sales to a 42% annual growth rate, while only modestly lowering the 22.4% gross margins it recorded in the last quarter. "If Dell can significantly reaccelerate the revenue growth, the stock will go back to its highs," he adds.>>
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Thanks for the heads up stock bull. I have more DELL shares today than I have ever had...and I feel very comfortable holding them. I TRUST Michael and his team.
Regards,
Scott |
