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

To: John Koligman who wrote (171449)	11/2/2002 10:26:58 PM
From: Sig	Read Replies (1) \| Respond to of 176387

From the Fortune article: <<Fortune calculates that in seven years Dell will have an extra 250 million shares on the market, adding almost 10% to its total float>> . For Microsoft and Cisco, the number is more than 8%. Statement needs work Dell in 6 years to 2002 bgt back 940 mm shares or roughly 33% of the company In last 4 quarters,@ 79 mm or 3% Has recently added 250mm to the previous 1 bill buyback program In 7 years might have 33% fewer shares outstanding, as opposed to 10% more. So I would check other statements made by Fortune, but not tonight Sig

To: John Koligman who wrote (171449)	11/4/2002 8:58:50 AM
From: mepci	Respond to of 176387

John: dell won't have 250M more shares. They will be bought into option plans at the expense of SE. Since most Dell shareholders won't believe in the importance of SE, they will stay optimistic on the basis of earnings and sales growth. Based on that I expect Dell stock price to keep pace with sales/earnings growth with a p/e (on operations not SE growth) of 35 to 40. If focus shifts to SE, a lot of current Dellholders will have a heartburn.

To: John Koligman who wrote (171449)	11/4/2002 11:59:53 AM
From: D.J.Smyth	Read Replies (1) \| Respond to of 176387

John, article uses very bad math: ...Even if it generates near-peak profit margins, to return 10.4% a year to shareholders Dell will need sales of $118 billion in seven years. That's more than 80% of the global PC market; today Dell's market share is 16%... in seven years the worldwide PC market is expected to grow at an annualized rate of 6%, notwithstanding that India's PC market grew by 50% last year (same expectations this year) and China's by 40% (China and India combined constitute nearly 40% of the world's total population, and 50% of its growth). this "6%" growth is consistent with the growth in the overall world population, especially considering growth in industrialized nations; it actually underweights the worldwide population growth. if the current world market is $145 billion, a 6% growth per annum, in seven years will yeild $220 billion market. $118 billion in sales is 54%. their "$145 billion" figure, however, does not constitute many accessories to the PCs, including printers, services, enterprise software and total enterprise systems. so, in reality the worldwide total market for PC's and peripherals is much higher, is over $250 billion. if you use $250 billion instead of the $145 billion figure, and a 6% growth rate, in seven years the total market will be over $380 billion. $118 billion as a percent of $380 billion is but 31%, certainly a more realistic figure. i guess the author figures we all buy into everything written through the press? why would he make such poor assumptions for his article?