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

To: Gabriel008 who wrote (63894)	9/6/1998 11:53:00 AM
From: jim kelley	Read Replies (1) \| Respond to of 176387

Gabriel, Bob Brinker bought into the argument that Baron's put out on DELL. His comment was that DELL was trading at a very high multiple of book value. I think that he did not put much thought into his comment. If you hold DELL stock the stock buy back becomes a tax deferred dividend. Why a company should hold onto cash or buy plant and building in order to increase book value?? Seems dumb to me! If you buy into the book value argument, then you should dump MSFT and CSCO too. Companies like INTC need to invest in expensive plant and equipment to do their business. Companies like MSFT do not need expensive factories they need test facilities, office and lab space. These are a lot less expensive than a semiconductor foundry. DELL needs office space and factory space. Fortunately, it does not need warehouse space like CPQ, etc. Here are some comparisons: Comp.------------P/E--------P/sales--------P/Book-----PEG CPQ----------69.0---------1.99------------4.87-----------NC GTW---------21.7--------1.07-------------6.66-----------.72 DELL--------54.5---------4.61------------49.14----------1.0 CSCO-------40.9--------10.94------------14.66--------0.4 INTC--------25.5---------5.35-------------6.05----------NC MSFT-------45.6--------16.44------------17.38--------0.8 GE-----------27.1---------2.62-------------6.94-----------2.0

To: Gabriel008 who wrote (63894)	9/6/1998 1:57:00 PM
From: Chas	Read Replies (1) \| Respond to of 176387

thanks for the post, the option newsletter view on Dell, I would appreciate everyone's feedback on this guys view:-good trading ***************************************************** DELL Computer $109.50 (-9.25)(+1.27)(+11.88)(-1.63)(-1.35) Post split price $54.75 Surprising strength from Dell on split Friday. After being down -3.31 mid-afternoon Dell roared back almost +$5 to close positive. This has made us wonder if maybe the -$20 drop from the high last week of $129 flushed out all the profit takers and split traders. To substantiate this thought we researched the recent volume and found that 335 million shares had traded since 8/20, the first day of the current market weakness. This is over half the outstanding shares of 660 million and an enormous amount. Furthermore since the high of $129 on 8/26 more than 259 mil shares have been traded. The theory: After the high on 8/26 and the market weakness that followed the momentum players ran for the fire escapes taking their profit and 250 million shares changed into new hands at bargain prices around $100-$110. The fallacy: While this sounds good and even may be correct the fact remains that current holders will have a new "dividend" share in their accounts on Tuesday. Stock dividends have special tax consequences for corporate owners. (less taxes) Corporate owners can sell their new shares without the normal heavy tax trigger. A large number of retail investors also see the new shares as an windfall profit opportunity. They can sell the new shares and six months later the old shares will appreciate back to the old level another split occurs and they get to do it again. (I did not say this was rational thinking but many investors take this short sighted approach. Any rational investor would realize that they are killing the greatest profit opportunity in the world by removing the duplication opportunity. If the old share will appreciate back to $120 and split again so will the new share. And so on, and so on.) Now for the really hard part. What will Dell do this week? I could take the easy way out and drop Dell as a pick for a couple of weeks but I can't bring myself to do it. I am (in case you haven't noticed in the past) STRONGLY BULLISH ON DELL. This does not mean it will not go down this week. If you read the commentary you know we are expecting a strong week if Latin America does not explode in our face. If we get a strong week the money on the sidelines will come into the market looking for the best stocks with the strongest growth potential. South America is a new market for Dell and ANY business from there will be new business. Latin America cannot impact Dell significantly. New money + cheaper stock price + strong growth prospects = buy Dell. If the new money coming into Dell offsets the "free share selloff" the Dell will go up. If we get more weakness in the market Dell will go down as people take their profits. (+$25 from the price 60 days ago) I am going to urge caution in opening a new position in Dell this week. Even if we get a bounce from the market for a few days there is still the lingering profit taking problem. If you start a new call position you either need to maintain your stops very closely or buy several months out and close your eyes for several weeks. I tried to layout the pros and cons but of course it is up to you to decide if you want to play this week. Post split depression is real and impacts 95% of stocks that split. Dell of course is not an average stock. Prices are estimated based on closing prices of the old strikes. BUY CALL SEP-55 DLQ-IK estimated price $3.38 BUY CALL NOV-60 DLQ-KL estimated price $5.50 BUY CALL NOV-65 DLQ-KM estimated price $3.63 If you want to play the post split depression possibilities: BUY PUT SEP-55 DLQ-UK estimated price $3.75 BUY PUT SEP-60 DLQ-UL estimated price $7.00 Picked on Jan 18th at $24.22 PE=65 based on 1999 eps $2.10 Change since picked +$30.53 52 week low =$17.50 (split adj) Analysts Ratings 10-9-9-0-1 52 week high=$64.75 Last earnings 8/18 est=.23 actual=.25 surprise Next earnings 11-17 est=.265 versus=.17 increase Chart on DELL quote.yahoo.wh News and Zacks on DELL quote.yahoo.com

To: Gabriel008 who wrote (63894)	9/6/1998 3:12:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 176387

Gabriel: Thanks for that elaborate post,I belive the contents are worth noting, however I do have a question and a few comments if that is ok with you. Could you elaborate on your take on Barron's comment: "I believe the comment " if I were a DELL shareholder, I'd be very unhappy that the assets it earns are being looted" was particularly damaging." I wonder by whom????? I don't quite understand the logic behind this statement. I personally couldn't care much about Barron's considering the fact that they have been quite negative on Dell for some time now,at least this is what 'they' tell me.I belive it was 'larry' who commented on Barron's a few posts ago pointing out the possible 'holes' in the veracity of the article. ref:"Sept. 25: Dell's Analyst Meeting, Austin, Texas. I do believe this is an important event and wish the public had access to the same information as the 'selective audience' by way of a news release from Dell instead of us having to rely on the interpretation of the 'chosen pundits' .I am sending Dell an email on this,may not be worth much but I wanted to let them know how I feel about this. ref"Dave Tremblay, a senior PC analyst at ZD Market Intelligence, is among those who see PC prices continuing their descent in the second half as the peak PC-sales season -- back-to-school to Christmas -- starts up." This is probably true for the holiday season but I think the magnitude of the 'decent' will be relative to the demand,that is to say-the weaker the demand the harder the 'decent' and conversely the higher the demand the softer the 'decent'.I guess it all depends on how the consumer confidence holds up by the holiday season.The reported stabilization in ASP going into the 2nd half gives one some comfort. Another point to remember is that the 'decent' will greater for the zub-zero vendors for whom the consumer is more important than DELL,will it not be???? Ref:"But keep one good investing eye on Dell's gross margins and Asia-Pacific revenues this quarter." I believe M.Dell has already given us some indication on this during the last shareholders meeting,I think he said a slight deterioration in gross margin could be expected going forward on account of the phenomenal growth rate the company is experiencing.So that won't a total surprise if it happens and the deterioration is modest.I am sure someone will correct me if this is a baseless conjecture on my part. I guess that is all I have to say for the moment and thanks again for the informative post. PS: here is the posts by 'larry' i was referring to earlier. Message 5679535 Message 5679696