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

To: Sig who wrote (168314)	1/7/2002 11:12:05 PM
From: stockman_scott	Respond to of 176387

Gateway sees 4th quarter profit, sales to miss target (UPDATE: Adds analyst comments) NEW YORK, Jan 7 (Reuters) - Personal computer maker Gateway Inc. (NYSE:GTW - news) on Monday affirmed guidance to return to profitability in the fourth quarter before taxes and charges, but forecast revenue of $1.16 billion, below expectations. The Poway, California, company said domestic unit sales fell 15 percent to 700,000 units in the fourth quarter from the third quarter. It had told analysts to expect a sequential increase during the quarter. The company said that weak unit sales were offset in part by a higher-than-expected average unit price of about $1,660 in the fourth quarter. Higher unit prices and cost cutting contributed to the return to profitability, Gateway said. Bear Stearns analyst Andrew Neff said it appeared Gateway had received a relatively large allocation of high-end Pentium 4 microchips from Intel Corp (NasdaqNM:INTC - news), allowing it to increase profit margins on the fewer than expected units sold. ``Despite a return to operating profit, the company is losing share and has a tough business model,'' he wrote in a note. Chief Executive Ted Waitt said Gateway had focused on its strategy of targeting higher-end customers during the holiday selling season. ``It's clear that a significant portion of market demand was at the very low end of the PC market in the fourth quarter, driven largely by aggressive pricing and promotions,'' he said. Gateway in 2001 announced plans for a massive restructuring, which included cutting 25 percent of its staff and shutting down all international operations. The company, which largely sells to the consumer market, was hurt in 2001 by No. 1 PC maker Dell Computer Corp. (NasdaqNM:DELL - news), which mounted an aggressive price war. In the third quarter, it posted its third straight quarterly loss, having lost $83 million, or 17 cents per share, excluding charges. Analysts expect the company to lose 1 cent per share in the fourth quarter on revenue of $1.4 billion, according to research firm Thomson Financial/First Call. Gateway shares were higher during trading on Monday after competitor Compaq Computer Corp. (NYSE:CPQ - news) said it would post a profit, not a loss, in the fourth quarter on higher than expected revenues, causing speculation that Gateway too had a strong quarter. Gateway gained 4.4 percent, or 43 cents, to close at $10.25 in New York Stock Exchange trading.

To: Sig who wrote (168314)	1/8/2002 1:32:19 PM
From: kaka	Respond to of 176387

Sig, Re: ""CPQ just went up 20% in 5 trading days- if Cpq can do it so can Dell "" Get Ready for the Relative Valuation Game to Run on Dell By James J. Cramer 1/8/02 8:27 AM ET Here's how it is played. Today, Compaq (CPQ:NYSE) announced good news. The stock is running up. In fact, it is going up so high that it, relatively, leaves Dell (DELL:Nasdaq) in the dust. So, tomorrow, at every hedge fund in the country worth its salt, the following discussion goes on: "Wait a minute, Compaq is selling for X? If Compaq is selling for X, that means Dell must be worth its current price plus a couple of points more because everyone knows that if business is good at Compaq, it must be great at Dell." Why does Herb hate this period? I am thinking back to when I first purchased Dell in my personal portfolio. Immediately Herb was on my radio show talking about how he felt that Dell couldn't possibly go up more because it is already fully valued. "What gets it to go higher?" he kept asking, rightfully. I didn't have an answer then, other than a weak "I think Dell's doing well and I want to be in share-takers , not share-fakers." Now that Compaq has moved, I have my reason why Dell can go up: relative valuation! Relative valuation is a suspect game. It is based on nothing other than casual observance of where some stocks are vs. where others are. Justin Mamis, my old technical guru and the teacher of Helene Meisler , used to rail against it as a version of the Greater Fool theory. I used to joke with him that Greater Fool might be a good name for my fund! Anyway, I always played this game to the hilt, which is in part why I outperformed for 15 years of hedge fund management. Nothing's changed. This game always works, short term. Of course, its undoing long term is that the web of overvaluation that can be bred from this relative thinking produced the 1999-2000 bubble that almost brought the house down. How can I advocate a technique that almost brought the house down? Because I also espouse the doctrine of selling. If you play buy-and-hold with the relative valuation game, you will be crushed. If you trade, though, it's short-term unbeatable.