Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Eddie Kim who wrote (45065)	5/27/1998 4:57:00 PM
From: Walt Corey	Read Replies (1) \| Respond to of 176387

re: Overvalued and overbought are nearly the same. Oh c'mon Eddie, I know you know better than that. But in the low $80's it is over-sold. I suspect it will hover between mid $80's and mid $90's for awhile and then start up again, perhaps after 2Q results. Walt

To: Eddie Kim who wrote (45065)	5/27/1998 5:11:00 PM
From: SecularBull	Read Replies (1) \| Respond to of 176387

I disagree: >>2)Overvalued and overbought are nearly the same, and for the average joe the difference does not matter<< A stock can be overbought, but remain undervalued because the method of valuation fails to take into account all of the reasons why a stock might deserve a higher multiple. It can be overbought at the same time, because the market is only taking into account the old method of valuation. Many people would argue that p/e is irrelevant for DELL, and that cash flow and r.o.i.c. is what really deserves attention. They would argue that DELL is undervalued. I would argue that at 90+ DELL is grossly overvalued because most investors (buying during the run-up) 1) are only in for the quick profits seen during the run-up (in and out in a matter of days or hours, but not just daytraders) and 2) many of the others value DELL using traditional valuation methods that do not support the lofty price. Absent these two categories of buyers, and absent the willingness of the devout DELL investors to prop up the price (the downward-side of the peak of the overbought condition), the price falls. When the devout and momentum buyers return, the price stabilizes (equilibrium). In any event, the price is still $20 higher than the last time you and I had a similar discussion. I see it staying here, just as I saw it staying where it was at that time. LoD