To: D.J.Smyth who wrote (149300 ) 12/15/1999 1:06:00 PM From: JRI Respond to
Hi Darrell...yes, I think Dell is a buy here...but, the market still lives under the "Taiwan earthquake/DRAM prices higher/margins" lower cloud....with other "hotter" things out there...I think some money wants to wait until things are clear..ie..an announcement from Dell..or, hopefully not..but could be...earnings in Feb....to let the stock really run.....I think the last couple days are indicative of what to expect....when the Naz goes down, Dell will not correct..going forward...to the extent it used to....however, its upside will also be capped.....did you notice today how well Dell held up when the Naz was going down thirty, forty, fifty, sixty....and how it bounced up as the Naz came back...but then, as the Naz went up five, ten, twenty....Dell seems stuck...and could not rise any further....I see this, somewhat, as a metaphor going forward......A real joker being: If the market ever gives Dell back its "E-premium" like enjoyed by Cisco, Sun, Oracle and countless others...we could see a pretty decent PE expansion, and pop of the stock...however, given I think the "E-premium" is pretty ridiculous anyway...after all, shouldn't it ALREADY be reflected in future earnings estimates....it is more likely that these stocks will get "Delled" and their PE's will contract to a more reasonable level...although it is unlikely that all three will come back to earth at the same time....of the three, I think Cisco's chances of floating are greater than the other two....
