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

To: calgal who wrote (160827)	9/19/2000 2:55:22 AM
From: Maverick	Read Replies (1) \| Respond to of 176388

MSDW:DELL will rise in 2H00 to $60 Excerpts follow: Fiscal year ends in January. Company Description Dell Computer manufactures and markets a wide range of computer systems and products, including desktops and software. Dell is the world’s leading direct computer systems company and one of the top five computer vendors in the world. The company is the leader in Internet PC sales. Valuation We rate DELL Outperform. We believe investors should own Dell for the second half 2000 story, and our belief that this management team with this business model will find exciting growth opportunities for a number of years to come. Our price target of $60 is equal to 51 times our calendar 2001 EPS estimate of $1.18. DELL is currently trading at a 50% premium to the PC group (based on PE). However, the stock has traditionally garnered a double valuation. With evidence of solid PC sales and good operational controls, we believe that the environment will build for Dell shares to rise in the second half of the year as investors see that the story holds. In our view, DELL is suitable for investors with a tolerance for the price volatility associated with technology stocks. Key Investment Positives · Dell’s core story is very much intact. We believe that Dell’s sales model of direct PC sales, leveraged by the Internet, is the model that many others in the PC business are trying to emulate. We think that Dell has advantages — rapid inventory turns, owning the customer relationship, a leading brand, and a growing presence in international, server, consumer, and workstation markets — that should allow the company to continue to outgrow its competitors and the industry. · Dell is a leader in PC sales over the Internet. We think DELL’s first-mover advantage in the Internet space is important and should be considered as investors think about appropriate prices for DELL shares. According to DELL, phase one of its Internet deployment, with the basic objective of gaining critical mass, is almost complete. Phase one has involved creating online services, establishing an Internet commerce engine, and moving supply chain management links to the Internet. Phase two will be about growing DELL’s role in delivering Web technologies to customers through a focus on content delivery, on faster access, and on building communities of inter-relationships between DELL and its customers. · We believe the PC demand outlook is positive. We think that overall PC unit growth will be between 15% and 17% year-over-year. Drivers include Windows 2000, Linux, new Intel processors, and new product introductions by Dell. Demand is also being driven by Internet infrastructure build-outs, which favor servers and storage. · Dell is the number one supplier of PC systems in the U.S. corporate market. We believe that when Dell penetrates a corporate account it is often very difficult for others to dislodge easily, creating a leverage point for the company over time. · Dell’s enterprise products continue to represent a fast-growing portion of sales and an important gross margin generator. We believe Dell is well positioned to move