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

To: BGR who wrote (79483)	11/12/1998 11:07:00 PM
From: Techie	Read Replies (2) \| Respond to of 176387

One of the reasons why the net companies are valued at extreme market caps is the lack of established measuring sticks. The unkown plays to their benefit and the hype helps. They are valued based on the size of the perceived market and their current market share. It's premature to assume they will maintain their market share or be able to maintain pricing. But right now, nobody can dispute their leadership. Finally, the single most important reason for the absurd valuation of net stocks is the fact that there isn't enough in the float. You can easily move EBAY's price by trading 10k shares on either side. Sure the daily volume has been high but the MMs move the price after each 100-200 buy sell. They can't do that with Dell. Dell is the net stock in the hardware group from the momentum stand. Otherwise, it would be priced the same way as IBM or HWP. Dell is not an internet company. The fact that they use the internet to operate more efficiently doesn't generate new revenues for them. It merely helps their operating costs and they may get a marginal benefit from better customer service. However, this approach is being used by many companies and I think CSCO does bigger numbers through the net than Dell. As the company grows in sales, their growth rate will slow down, especially in a maturing market. This is inevitable and well known. Therefore, either Dell is extremely overpriced in comparison to its peer group or the likes of IBM, GTW, CPQ are extremely undervalued. I suggest it's a little of both. But when push comes to shove, I would rather own EBAY now than DELL, as its stock would outperform Dell's in the coming 12 months.