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

To: Chuzzlewit who wrote (26214)	12/23/1997 1:29:00 PM
From: Andrew Fenic	Read Replies (1) \| Respond to of 176388

Paul, I understand fully that market capitalization are VERY dependent on future growth expectation and profit. Look at MSFT, for example. Obviously, if Dell's growth prospects went to 0 the stock would fall so far so fast it would make all of our heads spin. Their present valuation is entirely dependent on exceptionally strong growth through 1998 and probably 1999. Dell, however, would need to grow at a 40% rate over the next 3 years to catch up in revenues to where CPQ is NOW. Yet Dell has a higher market capitalization than Compaq. IMHO that is crazy. I think the reason for this is a combination of two factors. Compaq is very undervalued and Dell is at least somewhat overvalued. Hence I'm long CPQ and short DELL until the issues adjust, as they must, back toward a fairer valuation.