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

To: yard_man who wrote (80523)	11/16/1998 9:09:00 PM
From: BGR	Read Replies (2) \| Respond to of 176388

Tippet, It was very interesting to read your post. This is how it came across, please correct me if I am wrong: You feel that valuing companies is futile as that is always going to give too high estimates if individual company problems show up and/or demand shifts to another segment of the economy. Both of which always happens in the long run and hence the key thing is to time such negative incidents. By the law of averages, bust must follow boom and since the hardware sector in general and DELL is particular is now booming, bust must be around the corner. Sorry, but I think that these assumptions do not hold true for individual data points. Even if company earnings were determined by unbiased coin tosses, which they are not, a long string of heads would not make the probability of a tail more or less likely in the next toss. Worse, in real life, the probability of a good earnings go substantially up after a recent string of similar good earnings and in the absence of a fundamental change in the sector which is indicative of the fact that the company's strategy is being productive in the present climate. First, let's consider the sector issue. Except for the Forrester report, I have seen no market survey predicting a slump in the hardware sector in near future. I would like to know what you have seen. Next, there is no reason why margins may not hold steady (margins are not growing, BTW, check the numbers). After all your average productivity doesn't drop off all of a sudden in the absence of some extraneous negative factors, which I fail to find in the case of DELL. The same superb management continues to execute flawlessly. Would like to know your findings. Finally, I think that if you sit down and put pencil to paper, you will probably find that DELL is a rather attractive investment at the present time. Predictions of earnings and revenues are not that hard to find. Of course, what you consider reasonable is another issue. I would like to point out though that though macro market prediction is a fairly established field. -Apratim.