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

To: D. Swiss who wrote (164952)	4/25/2001 4:03:11 PM
From: Patrick E.McDaniel	Read Replies (1) \| Respond to of 176387

Drew, ref....there isn't another Dell model, but we rode it for all its glory in prior years. Unfortunately, now it is just a great company and a mediocre stock. This makes me think of Claudia Schiffer. She may have been in her prime a few years back but I'll take the crackers to bed if she wants them! Models on my mind! :o)

To: D. Swiss who wrote (164952)	4/25/2001 4:18:26 PM
From: stockman_scott	Respond to of 176387

Why Dell Will Stay On Top Of The World _______________________________________________ Wednesday April 25, 12:00 pm Eastern Time Forbes.com By Lisa DiCarlo <<On April 20, one business day before its quarterly earnings announcement, it was revealed that Compaq Computer had been toppled as the world's largest PC maker, a title it had held since 1994. Investors should not look for Compaq to recapture the title the way it did the first time, and that's a good thing. According to Gartner Group/Dataquest, Dell Computer , long the PC leader domestically, now has 12.8% market share worldwide versus Compaq's 12.1%. The ranking includes desktop and laptop PCs and PC servers. It's clear that large companies Compaq and Hewlett-Packard aren't interested in engaging in a PC price war for the sake of market share. They can't afford to. They've got single-digit PC margins compared with Dell's 18%. If they attempted to snag share by steeply cutting prices--as Dell has done for the past several months--they'd probably lose money on every box they sell. One of Compaq's claims to fame was the introduction of the low-cost Prolinea PC nearly ten years ago. That event plunged the industry into a price war, resulting in stunning consolidation and Compaq's ascent to the top of the PC heap. Today, Dell's ultra-efficient cost structure enables it to sacrifice a few points of gross margin for a massive land grab for market share. And, in fact, that's just what the Round Rock, Tex., company has done. For its fiscal fourth quarter ended Feb. 2, Dell lost more than three gross margin points sequentially, to 18%. In the first calendar quarter, Dell's worldwide market share roared up by 34.3% to 12.8%, according to Gartner. The second-biggest share-gainer was IBM , with 7% growth. Compaq's first-quarter PC sales were down 7% to $4.4 billion compared with the year-ago quarter, and its PC division lost $84 million in the quarter. The question for investors to ponder is whether the value of top-dog bragging rights is greater than larger gross margins. "The objective is not profit margin, but net profitability in dollar terms," says Dell spokesman T.R. Reid. It shouldn't be too tough for Dell to maintain and possibly even grow its worldwide lead, because other players can't compete on price. Plus, PCs have become such commodities that large computer companies don't seem willing to invest huge sums to beat Dell at its own game. Rather, they're investing in more strategic areas like services, high-end servers and storage. "They cannot afford to chase Dell in any kind of price war because they'll lose that war," says Gartner analyst Todd Kort, who conducted the worldwide survey. "I don't think it's as big a deal as it used to be, [being] number one, [because] PCs aren't so strategic anymore." Even Gateway , Dell's closest competitor in terms of built-to-order manufacturing and direct selling, can't match the company. That's partially because, unlike Dell, Gateway doesn't have pricier products--like servers and storage--to help offset lower-margin PCs. IBM, Compaq, HP and Gateway are by no means throwing in the towel on gaining market share. They'll just have to figure out other ways to do it. But they had better figure it out relatively soon before Dell, which already accounts for nearly one-quarter of all PCs sold in the U.S., forces consolidation or capitulation the way Compaq did nearly a decade ago.>>