LT:
Here is an assortment of comments from the first 220 posts on the Dell thread in 1996 that may give a perspective on attitudes. Mostly to point out that computer industry has often been thought to be on the verge of going belly up, and that the future can be seen
only vaguely and worries will always exist.
(Dell has split 3 times since these posts, so the the stock price today is equivalent to $616 /share.)
Here are 12 typical comments for those who dont have time to read them all:
Sig
SUMMARY
1. Hopefully the computer industry concerns are over
2. I think some of the disk drive companies said there earnings were poor because of a slowdown in the computer industry
3. I believe all the doom and gloom news of the PC industry is subsiding.
4. The recent earnings release was a good one and shows the widely reported death of the computer manufacturer stocks was wrong. Dell is solid! I'm in for thelong haul.
5. Llike it better than Compaq who are getting increasingly into the price competitive retail/home PC market.
6. I also read on the wire that the price cuts have not been as bad as the reduction in component costs.
7. Dell has a long way to go. They have held firm in the last few weeks while most tech stocks have taken a hit
8. I wouldn't be suprised to see a close @$50 tomorrow or Tuesday.
(note: within a few months it was over 100, today is $616 eq.)
9. The slow market of disk drive just matched a message from several Asian clients three weeks ago, saying lots of PC OEMs reduced 10% to 25% of their orders since April and may not be back until Q3. I cannot tell if this is a sign of another big shock comes out in July. If it is true
10. Chris, I don't know if you covered your dell but its price is getting rediculous. It is trading a 87 right now. Almost every time a medium to big cap stock has a big run up and then explodes to the upside it is close to a peak. I dought this is the exception. Dell
will probably be around 70 in the next week or so. I am going to join you in Shorting Dell.
Note: Too bad, it is now $616 sh eq.)
11. For example I bought at $16 and sold at $46 then more recently bought when they were at $28 in March. It's been a nice ride,
double your money in under 6 months!
Note: In todays prices he bought at $2 sh and sold at $6
12. For people who sell short -- and I'm not one of them -- there are plenty of equities that are more likely to take a dive than this one. It's had a tremendous run-up, but I'm not selling yet.
END
-----------------------------------------------------------------------------------------------------
RAW COMMENTS , extracted from Dell posts 0 to 220 or so
Sunday, Mar 31 1996 3:43PM ET
Reply # of 39573
There has been nothing but bad news from computer makers for several
months now. But Dell is growing with strong overseas sales
and, again, is taking market share away from Compaq.
Wednesday, Apr 3 1996 12:08AM ET
Reply # of 39574
It's my strong belief that Compaq and other
traditional PC companies are having a hard time because they are losing market share to
the direct channel and not due to some large scale reduction in overall PC demand.
Thursday, Apr 4 1996 1:40AM ET
Reply # of 39575
I think DELL is poised to outperform Micron and Gateway due to its bigger exposure
to government and business markets - 75% of their business is with the above with the
remainder in the home market. My company uses DELL almost exclusively (20,000+
employees) and GATE and Micron have much more exposure to the Home market which is
slated to slow down in the near future - on the other hand businesses should increase their buying
cycle as we move to win95 (most companies havent yet).
Monday, Apr 8 1996 10:36PM ET
Reply # of 39575
. Hopefully the computer industry concerns are over. Gateway had a nice day too. I too am ready
for the next set of earnings. If they are good, look out!!
Tuesday, Apr 9 1996 11:53PM ET
Reply # of 39576
I also read on the wire that the price cuts have not been as bad as the reduction in
component costs. Folks, look out for a BLOCKBUSTER quarter.
Tuesday, Apr 16 1996 9:12PM ET
Reply # of 39577
Did you guys all bail out or what?
It looks like some serious money is flowing back into high tech including Dell. Even,
since the last earnings report, stock has had a nice run after bottomming from 30 to 40.
Pretty healthy for a couple of months.
I believe all the doom and gloom news of the PC industry is subsiding. Amazing how
things change with these analysts even within a month or two. Seems to me, this stock
will accept a higher multiple because of company's growth rate. What do you guys
think?
Saturday, Apr 20 1996 1:06PM ET
Reply # of 39577
The direct channel has been able to take advantage
of falling DRAM prices better than some of the other traditional players like DEC and
Compaq because they manage inventory much tighter. Therefore, GATE never got
caught with any expensive DRAM and has been able to take full advantage of the falling
prices as they have fallen. I bring all this up because in the past Dell has responded very
well to good news from GATE, sometimes better than GATE itself.
Sunday, Apr 28 1996 10:19AM ET
Reply # of 39577
Dell continuous to be affected by other manufactures. Like Fridays
loss is due to Gateway troubles. It is my opinion that upcoming
quarterly report will define Dell as in class by itself. Dell is the
hottest computer maker today. It's support and products are above the
average.
Saturday, May 18 1996 7:34PM ET
Reply # of 39579
The stock has had a $20 plus run in three months. It may need
to base again for the next run up. The recent earnings release
was a good one and shows the widely reported death of the computer
manufacturer stocks was wrong. Dell is solid! I'm in for the
long haul.
Sunday, May 19 1996 11:44PM ET
Reply # of 39581
DELL will be 50 again by the end of the week, the short sell-off was just a few profit
takers and HP earnings. Once again the industry drags us down, BUT.... as always we
rebound strong. I wouldn't be suprised to see a close @$50 tomorrow or Tuesday.
Sunday, Jun 9 1996 5:02PM ET
Reply # of 39584
I think some of the disk drive companies said there earnings were poor because of a
slowdown in the computer industr. I think it is a bunch of bull. I don't see anything
wrong with the industry. DELL will still be strong.
Monday, Jun 17 1996 4:47AM ET
Reply # of 39584
Dell may be affected.
* The OEM customers include European, Asian and Northern American.
* By the way, still heard Intel got very good news to everyone in July, which sold more
high margin products. It is not 100% reflecting what PC industry is in April/June.T
Wednesday, Jun 19 1996 9:14AM ET
Reply # of 39584
Dell has a long way to go. They have held firm in the last few weeks while most tech
stocks have taken a hit. Once tech comes back in favor again, the stock should take off.
I have bought in twice over the last six months (at 29 and 39), and am considering
adding to my position.
Monday, Jun 24 1996 9:37PM ET
Reply # of 39584
That's a tough ?. With the recent concerns over the PC industry it's tough to tell. The
last time though that there were concerns all those stocks took off after these concerns
were washed away. I think it could if these concerns die down but if not then it may
take some time until it reaches this level although this is a great company so it may do it
anyway. Either way I think it's still attractive at these prices. If it sells off a little bit then it
may be an even better opportunity. I've never heard bad info on the company. Good
luck.
Thursday, Jun 27 1996 5:29AM ET
Reply # of 39584
"Everybody" is concerned about lower than expected earnings
of computer manufacturing companies this quarter. Why did
Dell have such a drop in its stock price today and not CPQ,HWP,SUNW
or IBM for that matter? I have spoken with my brocker. He said
they (Dean Witter) still have a price target of $66 by the
end of this year.
Friday, Jun 28 1996 12:04AM ET
Reply # of 39586
Since I have been posting in the DELL thread, I've always said the others
(computer-makers) will drag DELL down. But DELL operates its business differently
than the others and WILL continue to exceed expectations. The daily lingo that occurs
on Wall Street must always be ignored--take things from a macro perspective. DELL
will easily hit that target by the end of the year--my goal is 80 to 90 & and a 2 for 1
split. Tech stocks will again be the focus of attention as soon as all these earnings are
out--everything is becoming cheap.
Sunday, Jul 7 1996 8:28PM ET
Reply # of 39587
Leland, I too own some Dell August calls. Wish I could give you some specific good
news, but other than the fact that this is a solid company with a relatively low P/E ratio, I
cannot offer much. I am afraid Dell may get caught up in the generally bearish sentiment
of the current stock market, given last week's employment report. We need to hope for
low CPI (<.3) and PPI (<.1) announcements on July 12th and 14th. If these numbers
are higher than expected, look out. Dell won't be the only tech stock in trouble, in spite
of its sound fundamentals. I still consider it a great long-term buy, but we may not have
enough time. Hope my gloomy scenario is wrong. Good luck.
Monday, Jul 15 1996 11:56PM ET
Reply # of 39587
. Nevertheless, Dell is a victim of a general stock
market correction. I'm out at 46 and glad to get it too. I'm still
a believer in this company and its products, but I won't fight this
market or give up my good profit in this stock. ompanies that posted better than expected
earnings recently--pretty much all of them
lost about 7-8% yesterday. There is probably some logic in this total
freaking out--this drop in market is the worst in years. These
disappointments from DEC, MOT, HWP and others are a serious metter. And it
wouldn't be smart to ignore it. Intel will post its earnings later today. If they
are in line there when HWP announced they'd stop making disk drives it seemed like
pretty much everybody agreed that the teck stocks' party is over. On that
very day I happened to catch an interview of Robert Kippes --the Aim
Constallation Fund's portfolio manager. The guy said that even if the
market becomes bearish some computer stocks will be doing good. He didn't
want to give any specific names but it was clear he was talking about
Dell and Gate by saing that in an environment like this the companies with
the direct business model will benefit first. And look at the gains of main
computer stocks today: Gate, Dell, Sun Micro were ahead of everybody else.
Wednesday, Aug 7 1996 5:28AM ET
Reply # of 39587
I was thinking along the same lines: Dell has always been a very volatile stock and I
have made money by buying low and selling high. For example I bought at $16 and sold
at $46 then more recently bought when they were at $28 in March. It's been a nice ride,
double your money in under 6 months!
If past pattern holds the market will overreact again but I wonder if analysts are starting
to treat Dell more like Compaq? After all it is fundamentally a pretty well-managed
company these days with solid products catering for largely corporate clients. In that
sense I like it better than Compaq who are getting increasingly into the price competitive
retail/home PC market.
Thursday, Aug 8 1996 7:39PM ET
Reply # of 39587
DELL is doing fine for me, but everything else I own is in somewhat of turmoil right
now. AOL supposedly uses USRX modems, and I have read on misc.invest.stocks that
institutions are dumping the stock.
Tuesday, Aug 13 1996 6:51PM ET
Reply # of 39588
$1.15 before a one-time charge! Blows the 27 analysts who follow this company away
(ests. were at .87). Stock price was up 2 1/2 in after hours to a new high. I expect
upgrades and estimates boosts
Tuesday, Aug 13 1996 8:01PM ET
Reply # of 39588
I am surprised by their net income increased with almost the same amount of sales
compared to last quarter's. Actually sales was increased by 52M from 1.638B to
1.690B, but 'net' income was increased by 21M from 82M to 103M. The 'Net Profit
Margin' is 6.1% for this quarter, compared to those
5.0% in 04/28/96 quarter
This 6.1% of Net Profit Margin makes me nervous. Is this comany great or what?
Especially in this PC industry.
I have heard some PC system companies are playing component game at the end of
month. I hope we won't see this number drop back to 5.5% or 5.0% again on the next
two quarters.
I really can't be convinced that this number can be improved this much in one quarter in
this PC industry?
Tuesday, Aug 13 1996 11:24PM ET
Reply # of 39588
components and OEM price down 10% to 25%.
Not only DRAM, SRAM, FLASH, but also CD-ROM, graphic/audio and other
peripherials dropped more than system selling price did. This did contribute lots of profit
for CPQ, IBM, DELL, GATE....
As long as corp. price did not drop too much, profit should keep moving up. Dell
market is different from CPQ, IBM or Packard Bell, and your expectation need to
adjust for it.
I shorted this stock before, but learned a lesson and bought call now.
Thursday, Aug 22 1996 10:52AM ET
Reply # of 39588
Many Fortune 1000 companies still have a huge base of 386 & 486 systems
still out there. Dell with its direct model and JIT inventory and
manufacturing, is positioned to capitalize on several trends still
emerging in Fortune 1000 companies:
Thursday, Aug 29 1996 10:51PM ET
Reply # of 39588
Amadeo, buy low sell high, I didn't buy low buy I can sell high, I think it time to short
this one. I can see I price war heating up thi s fall, Dell already had to cut prices by 30%
in Japan. I do think Dell is the best PC company but it stock flucuates alot, it's had quite
a run in last few months, I think
Thursday, Aug 29 1996 11:49PM ET
Reply # of 39588
I agree with you! If you look at DELL's earing report, you can
see a lot of earing improvement from cost saving not from growing,
which is very limited and could be further deteriorated. No one can be
immune to price pressure for too long time. It may drop to $30 level
in a few quarters.
Wednesday, Sep 18 1996 3:44AM ET
Reply # of 39589
I am thinking to short Dell at the price. Any comment?
Thursday, Sep 19 1996 12:06AM ET
Reply # of 39589
Brian, now is probably a good time to start a short position, even if it goes to 90 it will
most likely drop below 80 in the future. It would be a good idea to wait for the
expiration of options this friday before taking a large short position. I think DELL could
have some more good news coming up however DELL will face more competition,
lower margins and a saturated PC market. Anyone who buys a pentium will most likely
use it for 3-4 years. Look what happened with the colour TV market
Thursday, Sep 19 1996 11:46AM ET
Reply # of 39589
I hope you are right. I just went short on DELL at 81.5 yesterday. DELL is a great
company and I had previously owned it's stock, buying at about 33 some time ago.
Unfortunately, I did not ride it all the way up. It may be fairly valued at its current level,
but, from my experience, this stock cycles and I think could be in for a correction as the
PC competition heats up and margins shrink.
Friday, Sep 20 1996 2:50PM ET
Reply # of 39589
Chris, I don't know if you covered your dell but its price is getting rediculous. It is
trading a 87 right now. Almost every time a medium to big cap stock has a big run up
and then explodes to the upside it is close to a peak. I dought this is the exception. Dell
will probably be around 70 in the next week or so. I am going to join you in Shorting
Dell.
Friday, Sep 20 1996 5:49PM ET
Reply # of 39589
For people who sell short -- and I'm not one of them -- there are plenty of equities that
are more likely to take a dive than this one. It's had a tremendous run-up, but I'm not
selling yet.
|
