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Technology Stocks : Dell Technologies Inc.

DELL 122.55

+4.4%

3:59 PM EST

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To: Chuzzlewit who wrote (129503)	5/28/1999 2:56:00 AM
From: jim kelley	Read Replies (2) of 176387

CTC, I think that DELL did the right thing in cutting margins. It helped DELL to capture the business it needed to get to the top line and still make the bottom line during a quarter in which most of the other PC makers were off the mark. The margin cut should pay off this quarter too in growing market share and pressure on the competitions margins which are far worse than DELL's. As Gigabuys gets bigger it will dilute the margin but it will raise the ROIC. Gigabuys diluted the margin this quarter too but not 90 basis points worth. This business model parameters are changing as new businesses are added to the business mix. There has been little attention paid to this fact by the analysts or anyone else for that matter. It takes a good amount of work to backout DELL's margins in specific product areas. DELL does not publish these and there seems to be disagreement among analysts as to what these are. Hence my impatience with Rudedog casual assertions on this topic. It is interesting that despite the slowing in YOY growth DELL is not slowing in either earning momentum or revenue momentum. So it is just a matter of time and execution until DELL dominates this market. Glad to hear that your wife is doing well. Regards, Jim Kelley

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