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

To: Jorge who wrote (34447)	3/15/1998 10:23:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

George, I'm not a bear, but I believe that there are two possible bear arguments. 1. The price of the stock is too high, and it has become a momentum players vehicle; and 2. The demand for computers is not growing as fast as it had been for the past couple of years. It is pointless to argue valuation because we don't know how to objectively value stocks. The second point is true, but we are not talking about a decrease in demand. We are talking about a decrease in the increase! And what effect will it have on Dell? Perhaps it creates the opportunity for Dell to increase its market share at the expense of companies like Dell and IBM, without eroding Dell's profit margins. After all, what will CPQ and IBM do with their aging and expensive inventory? If they try to sell it before building new machines they will be trying to sell already obsolete machines at the expense of the newer, faster models. That will place these two companies in the second-tier, and Dell increase its market share in the corporate space. And if they sell the bloated inventory at the same time they are selling newer machines it will take longer for them to clear the old inventory and in order to make the pricing attractive they will end up cannibalizing their own sales. Regards, Paul

To: Jorge who wrote (34447)	3/16/1998 11:05:00 PM
From: John Trader	Read Replies (1) \| Respond to of 176387

George, Amen to that. For all Regarding Y2K: Paul Reuben recently posted an interesting article from the Washington Post which suggests a tech slowdown and mentions the "Year 2000 Problem" (Message No. 34368). washingtonpost.com. I am sure this has been discussed before, but I wonder if anyone has any thoughts on Y2K, and how it might relate to Dell. I recall listening to a tech analyst on "Wall Street Week" a while ago advising simply to stay out of elevators on January 1, 2000 if you are worried about it. He did not seem to think it would be a big deal for tech stocks. The above article is mostly negative regarding the impact of Y2K but does mention that some companies may decide to scrap their older computer systems and re-equip, which would have some benefit. There was an article in Barrons a few months ago in which the argument was made that Y2K will be a big hit for tech stocks because all sorts of companies will use up most of their technology budgets on Y2K and therefore cut way back on other tech purchases during this time. In addition, there is a new book out on the Y2K problem (seems like sort of a scare-book without a lot of substance, forgot the title) which makes the argument that any company that gets significant revenue from Uncle Sam will get hit hard from Y2K because of drastically reduced government spending around that time on all other things. The book mentions 3-Com as an example of a company that gets a lot of revenue from the government. Does Dell do a lot of business with the government? I sort of recall that they do. There certainly is a lot of conflicting views on this Y2K issue and tech stocks. Perhaps this post will generate some more discussion on it and how it relates to Dell. Best wishes to all, John