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

To: Mohan Marette who wrote (34886)	3/19/1998 9:26:00 AM
From: David Harker	Read Replies (1) \| Respond to of 176387

all - Comparison: Dell & Berkshire (buffet) Check out (near the bottom) where the Motley Fool site has a write-up on the value of Berkshire (Warren Buffet's company) and moves on to compare Dell very favorably to Berkshire... fnews.yahoo.com which says: "The insurance subsidiaries are extremely important, then, to the value creation capabilities of Berkshire Hathaway. Any business that regularly incurs no cost of capital is a high-quality company with the right business model or management ability. Dell (Nasdaq:DELL - news) , for instance, does so well financially and carries what looks like a large capitalized value for a PC company precisely because its cost of operating capital is very small, given that its suppliers and employees regularly finance the current assets that the company does use. The similarities between Dell and GEICO, for one, are significant. Both operate in seemingly low-margin businesses. Both cut out the middleman and market directly to their customers. Both, therefore, gain a cost advantage over competitors. More important, both employ far less capital than their competitors to achieve the same results, meaning that additional inflows of capital into these businesses generates much higher earnings growth than their competitors. Capital efficiency, and not margins, is the essence of the "light" business model with a high stock market valuation. "