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

To: kemble s. matter who wrote (156514)	4/23/2000 10:09:00 PM
From: rudedog	Respond to of 176387

Kemble - re: Re: DELL's ability to steal market share is all that really counts... Well, I would have to disagree - the ability to grow revenue and profit is all that really counts. Packard Bell stole share from everyone, and made it to #1... where are they now? next, you say Every market they have entered they have become #1 or #2 Hardly cheers me up - you DO know that CPQ is #1 in every market it is in - except for high end Unix, where it is #1 or #2 in the areas it targets. And CPQ is not my favorite stock right now... Getting above #4 in the market was also the end of DELL's hypergrowth, and also the end of it's rapid stock price gains. Getting to #1 is pretty much just the end of the line. finally, re: Watch them pass CPQ in servers ... I would make the same argument as above regarding the challenges of being #1. It doesn't get you any business, pre se. It just makes it harder to grow. And I'll repeat what I said about the key initiatives DELL has done in the last 2 years - storage and consumer products. Neither has resulted in ANY share gain for DELL... I regard both of those as a complete bust. So DELL has been forced to concentrate on the areas where it is strong, and the requirements on excellence of execution are exponentially more difficult when you are #2 than when you are #4. We only need to look at DELL's stock price and earnings growth since they made it from underdog to top dog to see the effect. So, unfortunately, all the things you are saying reinforce my concerns about future growth. I would like to see DELL concentrate on Asia and "rest of world", where they are no better than 5th, since they will not have "hit the wall" yet in those markets. I would like to see them do a breakout in enterprise, like they started to do 2 years ago with storage - they are a small player in the enterprise at the moment, something like #6 in revenue terms, so they have a lot of room to grow there. And as SUNW is demonstrating, it's a great place to be. DELL should either find a way to make a difference in the consumer game or quit talking about it - the current strategy seems like it is bad business, bad pr and bad for profits. I don't understand what their plan is in that space. What they have done is to timidly defend their low end line and put a toe in the water on outsourced volume consumer production, but with no notion of how to drive demand. DELL can, of course, just continue to march, doing what they do today - they are still the most efficient commercial PC producer, and that market will be good for 15 to 20% growth, which should give DELL 20 to 25% for a while yet. But DELL at 20 to 25% growth will be a different company than the one we have seen in '96 to '98 and more like the one we have seen for the last 14 months.