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

To: Jerry G. who wrote (30396)	2/19/1998 11:27:00 AM
From: ffpjr	Read Replies (1) \| Respond to of 176387

My Full Serv guy just told me they have revised estimate to 130.

To: Jerry G. who wrote (30396)	2/19/1998 4:15:00 PM
From: Reginald Middleton	Read Replies (2) \| Respond to of 176387

<This COMPANY never ceases to amaze me. It is doing so financially well and just keeps getting better, boy am I glad I am involved.> Dell was actually trading at a discount, but the recent media exposure over the earnings release seems to be assisting in Dell's discount being eaten up. With a constant growth rate of 2.5% and its current cost of capital of 10.4%, Dell's discounted cash flows amount to $124.07 per fully diluted share (this includes nearly 1 billion dollars in employee stock option liabilities). Under the same assumptions as stated above, its valuation using discounted economic profit (after tax profit as adusted for periodic risk), Dell's valuation is $133.77 per fully diluted share (Michael Dell adheres to the EVA style of value based management, hence he manages his company to optimize economic return on capital on a periodic basis). It's profitability puts it in the top 1% percentile of its sector and growth is in 20.20%. It would appear that Dell has started a notable trend in increased profitability, with both its economic spread and its total economic profit increasing dramatically over the last four years. For anyone interested in seeing the numbers behind these assertions, a full (58 page) economic analysis of the Dell Corporation is available at rcmfinancial.com