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

To: Mohan Marette who wrote (84104)	12/7/1998 5:52:00 PM
From: SecularBull	Read Replies (4) \| Respond to of 176387

Mohan & THREAD, interesting article in FORTUNE about DELL's "guidance bias" in relation to analysts estimates. On page 257 of the Dec. 21 issue, FORTUNE explains that DELL has traditionally given conservative guidance to analysts, which in turn has traditionally led to numerous upside surprises. Since analysts tend to base their estimates for future quarters on a company's guidance, their estimates tend to be much lower than the real numbers once they appear. The crux of the article was that DELL, while trading at 44 times consensus FY 1999 estimates, actually is trading at an implied P/E ratio of 27. Interestingly enough, it also says that Compaq trades at 20 times FY99 estimates, but the implied ratio is 24. All the companies cited are moving closer to moderating their guidance as time moves forward (see DELL not surprising by $0.05 any longer). Regards, LoD