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

To: Geoff Nunn who wrote (151617)	1/19/2000 5:43:00 PM
From: Mike Van Winkle	Read Replies (1) \| Respond to of 176387

Geoff, re: how many more "one-offs" (i.e., disappointing qtrs) can Dell sustain before the market does see disappointing growth? A black box approach has that kind of decision problem. Try looking a little deeper under the hood and I think you will find the answer. Cheers Mike

To: Geoff Nunn who wrote (151617)	1/19/2000 6:03:00 PM
From: JRI	Read Replies (4) \| Respond to of 176387

Geoff- I agree with you, in the sense, that Dell (for the stock's sake) needs to get back to meeting/beating analyst's estimates (instead of...as we have experienced over 3 of the last 4 quarters, and possibly 4 out of the last 5..either revenue "misses" or EPS shortfalls)....If Dell is not able to do this in fiscal 2000 (ie. meet my 1.08 expectation) then I will agree with your premise that the growth curve has permanently shifted (quicker than I thought), and that the .01 "miss", if it occurs, was a signal, no doubt... If not, though, how does one deal with these "one-off" situations, if they occur more frequently than "one-offs" (oxymoron, no?)..but not enough to affect the permanent growth curve?? Well, I would agree with Chuzz, that part of the answer is the natural "lumpiness" of the business...but the other risk is, what I'll call, rightly or wrongly, the natural business risk of the (PC biz)...Dell is simply stuck in a very difficult industry..one in which it is awfully easy to screw up....due to many complex factors...as a result, it wouldn't surprise if Dell sells (should sell) at a bit of a discount (vs. another company in another industry, with the exact same fiscal growth prospects..but an "easier" industry....)I think Dell's enormous success during 97-98 covered up how incredibly difficult the PC biz really is.....even if you have the best model.... I think Dell does currently sell at a discount (vs. other growth companies, S& P 500)..maybe these "one-offs" (present/future) ...the fact that Dell is in a more difficult industry than others...is ALREADY discounted in the price....I think so......I think Dell's fair value in somewhere in the 45-50 range.. I think the market has already priced in .20 quarter for Dell. This is pure speculation on my part. I fully grant you that, if Dell can not meet $1.08 (+/- .01) for fiscal year 2000, the growth curve HAS SHIFTED (slowed, 1999 was NOT a series of "one-off" occurances, and Dell, the stock will reflect this (with a smaller rate of appreciation in '00). I still see Dell stock somewhere between 65-70 by Jan. 1, 2000. I believe that Dell will make approx. $ 1.08 for fiscal 2000...