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Technology Stocks : Disk Drive Sector Discussion Forum
WDC 153.96+0.7%3:59 PM EST
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To: LK2 who wrote (5686)2/26/1999 12:30:00 PM
From: Robert Douglas  Read Replies (3) of 9256
 
Larry,

Speaking of Merrill Lynch's Steve Milunovich, yesterday he wrote:

There are two good reasons to expect an acceleration to occur in 1999: (1) last year's inventory corrections over so sales-in will better match sales-out, and (2) component prices are firming, aiding ASPs. Our surveys confirm good PC spending this year, especially in the first half thanks to Y2K upgrades.

Firming component prices sounds like good news for HDD makers. Right? Could it be that some of that PC profit might begin to flow down to drive makers? 8% margins at DELL always seemed a bit high, after all aren't they just a retailer?

Also from the report:


Worldwide PC Growth

			95	96	97	98	99E	00E	01E	02E
IDC Estimates
Unit growth %		25.2	17.7	15.6	11.1	12.8	13.9	13.2	12.6	
Revenue growth %	31.9	40.1	5.6	0.6	3.6	9.7	10.1	9.7	
ASP change %		5.4	19.1	-8.6	-9.5	-8.1	-3.7	-2.7	-2.6	

Dataquest   Est. 
Unit growth %		25.4	17.9	15.2	14.3	13.9	14.8	15.6	13.6
Revenue growth %	28.8	21.0	6.5	2.3	7.7	15.1	13.8	13.3
ASP change %		2.7	2.6	-7.6	-10.5	-5.5	0.3	-1.5	-0.3



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