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Technology Stocks : Dell Technologies Inc.
DELL 137.59-2.3%10:35 AM EST
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To: Michael Bakunin who wrote (109256)3/12/1999 4:49:00 PM
From: BGR  Read Replies (1) of 176387
 
Michael,

Any model is just as good as the data that goes into it.

You write:

Assume five years of 40% growth (questionable), and perpetual "stable" GDP-like growth of 2.5%.

Unless you expect the growth of the high-tech industry to slow to low single figures as well, this is not very plausible. The high tech industry is presently growing in the mid teens. If it's growth slows down to match your expectations, the US economy will probably be in a recession. If that's what you are expecting, then you are making the appropriate decision to buy puts.

I am not, so I am buying calls.

but using less-aggressive, 5-year growth of 20% cuts it to a sell (PV $40)

This counters every single published estimate of DELL's growth that I have seen and the rationale presented! But it is true that you may be right while everyone else is wrong. ;-)

-BGR.

PS: BTW, 20% is still pretty aggressive.
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