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

To: Jim Patterson who wrote (43395)	5/19/1998 5:14:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

Jim, we know prices dropped -- that's a no-brainer. You've been arguing two points: 1. That Dell will face a profit squeeze because of increased competition. There is no evidence of this. 2. The drop in prices would squeeze profits because sales in units couldn't go up fast enough to compensate; there is considerable evidence here to the contrary. Because of the increase in gross margin, the decrease in gross profit per unit is only 2.53%. Here's the math: previous quarter's gross profit/ unit = .222600=$572.00 current quarter's profit/unit = .2232500 = $557.50. Difference = 14.40/unit or 2.53%. Debt doesn't lower the tax rate. It lowers income (via interest expense). TTFN, CTC