SB- I have to disagree..look at today's action...with all going on (2 downgrades, major publicity about Dell dragging the market down...Dell "not being able to meet future growth expectations", terrible bond market reaction (Japanese repatriation & big Fed bonds floating before April tax payments kick in..)...and Dell couldn't even break 80...In my mind, it's clear that many of the "weak hands" in this stock have walked off...c'mon, if you believed all "sell" arguments that has been said the past two weeks...you would have sold too (and you did !)....The substantial remaining bulls believe it was just a blip, and, IMO, it will take a 35% y-o-y revenue growth quarter, and significant lower earnings and EPS growth to shake the trees again....you sure as heck aren't going to get that in Q1 '99..Additionally, IDC/Dataquest will report whopping market share gains for Dell in late April..that will help the run...
If there were still serious problems with Dell here... it would have tanked more today (intraday, end-of-day)....Compaq sold off as much as Dell today.........Getting through the 70's is going to take a major market sell-off...and I predict, even if so, other big cap techs will sell off (% basis) even more...However, there is no major market sell-off here, IMO...today's bounce was encouraging....
The action around the last earnings report, despite the big drop,was fairly typical (the sell-off always happens....sometimes 15%, sometimes 20%...this time it sold off a bit more...due to the "disappointment"..but, then again, it was up an obscene amount during the quarter, too)..
Re: Traders abandoning the stock permanently.......Traders posses incredibly short-term memories....and will get on the next train that looks like its moving...They will come back for the earnings run...nothing has changed there...where's the proof that they have abandoned the stock? (except for the short-term, right after earnings...they always do...and then they come back for the surest play around...Dell a few weeks before earnings...)
I do give you that Michael Dell & Meredith will have to do a bang-up job at the early April analyst meeting, but if the stock is still lagging at that time (like last year during this quarter...6-7 weeks of dead money before a rapid rise)....it will rally after the meeting...
A real joker is the announcement last week...Could hike the stock a few points and it could plateau at a higher level (than 80/81)...before the next earnings run...
We are poised now for a nice rally soon....lots of cash on the sideline, bonds have gone about as far as they are going to go, earnings improving, economic fundamentals great...
So, needless to say, I don't share your vision here...We'll see soon enough...
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