eddie -
The problem is not with DELL's superb performance, it is with the perception that such performance will not continue as DELL goes from being a small player to being #1 in the PC business.
If DELL does not do something to get "outside of the box" of being a PC maker, then they will, in the relatively short term, see growths which are closer to the overall industry. Especially when the other major players (IBM, HP and CPQ) are downplaying the value of the PC sector and moving to other business models, DELL needs to explain how they will maintain the high growth which has justified their multiple, currently about 5 times that of CPQ. If you are comfortable with today's stock price, and would be comfortable with little or no growth in stock price for the next year or so, then settle in and be happy with DELL's recent financials.
If on the other hand you would like to see DELL get back into the price appreciation which has characterized the stock over the last 5 years, then you should take heed of some of the information currently being presented, and join the rest of us in the exciting game of second-guessing DELL's next move, which had better not be "more of the same". |
