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

To: TigerPaw who wrote (60483)	8/24/1998 12:21:00 PM
From: SecularBull	Respond to of 176387

TP, I agree with your post entirely. My point about Meredith was based on very recent comments that I have heard through the grapevine that I believe to be reasonably accurate. Meredith's focus on ROIC is something that he brought to DELL, not something that he is perpetuating at DELL (management has embraced this method of valuation, without question, regardless of his future with the company). I think management at DELL is much deeper than it is given credit for, and I expect that the fundamental strengths of this management team will propel us along very well in the foreseeable future. Regards, LoD

To: TigerPaw who wrote (60483)	8/24/1998 12:25:00 PM
From: Lee	Respond to of 176387

Hi TP,..Re: Meredith placed a spotlight on Return of Invested Capital which gives Dell it's incredible cash flow Thanks for pointing this out. Sometimes we forget that a company's performance might be based on execution of business plan. Meredith's contributions shouldn't be overlooked and in my mind, are equally important. cfonet.com Regards, Lee

To: TigerPaw who wrote (60483)	8/24/1998 2:39:00 PM
From: Chuzzlewit	Read Replies (2) \| Respond to of 176387

TigerPaw, I think that Meredith's importance to the company goes beyond spotlighting Return on Invested Capital. After all, that's an end, not a means. There was an article some time ago (sorry, I don't have the link) that pointed out that the means to achieving that end consisted of three components: negotiating favorable terms with vendors, accounts receivable management and days' inventory. The combination of these three factors is what Meredith terms the cash conversion cycle, and by focusing on the minimization of the cash conversion cycle you end up with an organization with sufficient cash generating power to fuel hypergrowth without resort to external financing. That article pointed out the the cash conversion cycle was approximately equal to the inventory average prior to Meredith's tenure at Dell. The cash conversion cycle is calculated as: CCC = Days in A/R + Days in Inventory - Days in A/P. It is currently an astounding -7 days!! Now Meredith promises to lower inventory levels to around 5 days. If that were the case now, Dell would have an extra $108 million in cash and/or marketable receivables. TTFN, CTC