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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Walcalla who wrote (143192)	9/29/1999 7:26:00 PM
From: rudedog	Read Replies (1) \| Respond to of 176387

where everyone bitches about the stock being stuck in the low twenties for 2 years If only that were true. The reality is that CPQ was over 50 earlier this year, and was in the high 40's for quite a while. Many CPQ investors missed the opportunity to sell, and some bought at those levels. BTW I think the go-forward position for both DELL and CPQ is equally good, but for different reasons. Neither stock is likely to go down much below current levels. Both are in a position to maintain leadership positions in the industry. DELL has to make a transition to broaden its position in the industry to maintain growth, while continuing to execute in the current sweet spot, the commercial desktop market. I think they can do that. If they do, they should start to move back up in stock price. I think 30% per year is achievable starting next year. CPQ has to consolidate their product lines and cut costs while maintaining their current business. I think they can do that. Once the street perceives that happening, the stock price will pop back to its pre-disaster levels, high 30's or low 40's. Based on where they are today that is a nice pop but based on where many investors got into the stock, it is just break-even. CPQ should be able to get back to a 25% growth in share price annually. I base the potential stock price growth pretty directly on revenue growth for the companies. There is not as much connection between fundamentals and share price as I would like, but over time it seems to roughly correlate... So either of these stocks is a solid core holding, both should appreciate well in '00. Neither will be the rockets they were in the past, but neither has much risk of depreciation either. I don't see a good reason to sell or transfer either one at the moment, especially given the tax consequences. But likewise I am not adding to either holding. The only issue in my mind on either DELL or CPQ is exactly when they will get a sufficiently coherent picture in front of investors to justify increased share price, not whether it will happen.