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

To: Jim Patterson who wrote (26436)	12/29/1997 5:54:00 PM
From: Meathead	Read Replies (1) \| Respond to of 176387

Now see... when you do a little math, you observe more realistic numbers. A 10% drop in net margins IF the region dropped to ZERO which will never happen. Secondly, OPEX is easily held flat from a dollar standpoint for any given quarter with Dell's business model... and, COGS will decline due to component costs (no, all component suppliers won't go out of business) which will increase GM. Most likely, sales growthto the AsiaPac region will slow but Dell's profit margin will increase. The impact of this situation will actually be positive for Dell. You need another scenario to become bearish... this isn't it. The time to worry is when component costs are increasing... Dell's model backfires in this situation... Dell's management has made a wager that this will rarely ever happen. They've been right so far. cheers MEATHEAD

To: Jim Patterson who wrote (26436)	12/29/1997 6:49:00 PM
From: Meathead	Read Replies (3) \| Respond to of 176387

Not ignoring the fat chance items. You do take the pessimistic view. Do you read Bear-ons regulary? IMO Can management handle inventory in such an enviroment ? Geeez, if Dell can't, I ask you, who can! Will the investment income column preform the same ? who cares? peanuts... Will ASP's stay the same in such an environment ? No. IDC says industry wide, ASP will decline from $2215 to $2138 in 1998. With a drop in units will part pricing be the same ? This is not a concern, there are too many balancing forces that will keep this in check unless things go totally out-of-control. As far as the rest of yout what-if's... good greif, what if we get hit by a giant meteor? The scenarios you're pontificating would spell global economic disaster... a technology melt-down-deluxe at the very least. Not gonna happen anytime soon. cheers MEATHEAD