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

To: Sig who wrote (157854)	6/13/2000 8:25:00 AM
From: hdl	Respond to of 176388

sig, thanx for listing almost all of my points so nicely

To: Sig who wrote (157854)	6/13/2000 8:30:00 AM
From: rudedog	Read Replies (2) \| Respond to of 176388

sig - good post - but re: Then they said prices were falling. Average Selling Prices for commercial desktops have dropped nearly 40% in 2 years, after remaining fairly stable for the previous 5 years. Some people see a correlation between that fact and the decline in DELL's revenue growth, and in fact the curves look remarkably similar. I think that the effects are unrelated but it's not an empty argument. Then they said PC sales growth was dropping No question that PC sales growth is dropping, although that has been happening for a long time. It has gone from more than 50% per year growth in the mid-90s to something around 18% now. Then they said y2 would ruin everything I also seem to recall DELL management saying something about that in their last two earnings releases. Not "ruined" but big enough to affect earnings and stock price. Then they said Dell's revenue (growth)was dropping( despite Dell reporting a 58% profit growth Hmmm, pretty clear that DELL revised growth projections downward pretty dramatically over the last year or so, from the 50s to the 30s. Then they said Dell did not have an 'under 1k computer' although they did. DELL did not have an "under 1K computer" until 1999. DELL management said on several occasions prior to 1999 that they were not interested in the low end business. Then they said everyone would buy a free PC ( why do you have to buy them ?) Just ship me one(hehe) Have to agree there, businesses which have free product as a part of their model have some fundamental problems IMO... Then they said the server market was too tough. DELL's server story has been a replay of their desktop strategy and it is hard to argue with success. They still have not moved into the upper end of even the Intel-based server market but may do so this year. Then they said the PC was dead Frankly, the PC market looks weaker every year. I don't expect that a $100B business will vanish overnight but it looks to me like an increasingly ugly place to be. Now they say we got a &^%% component shortage? If the PC is dead how can you have a component shortage?* But there IS a component shortage. Suppliers at several levels of the supply chain are moving production capacity into components for handheld and mobile devices, new processor technologies have lower yields than previous generations, disk drives and other key desktop components are tighter than they have been in many years, despite the reduced industry demand. The drop in Average selling price means the big vendors need to pick up volume to maintain the same revenue. DELL needs to do more than the rest of the industry to maintain their greater than industry growth. So all in all that list is pretty accurate. Does it mean DELL will collapse - not hardly. But it does mean that continued excellence in supply chain management and field execution is a requirement, not just a competitive advantage.