Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Chuzzlewit who wrote (85088)	12/13/1998 2:22:00 PM
From: rudedog	Read Replies (1) \| Respond to of 176387

Chuz - I agree, I was just discussing GM. I had been using 9% as a discount rate in '97 but I think it would get closer to 6-7% in '99 if the percent of direct business gets anywhere near the target amounts. IMO this puts CPQ and Dell about on par WRT 'real' GM. CPQ of course continues to have a higher COGS which explains why they end up with a lower percent net. But this is an across the board problem not specifically related to the consumer segment. I continue to believe that CPQ can play profitably in that segment whereas Dell will need a different model to get much lower than their current low end pricing and maintain reasonable margins. This is a lot different than the commercial desktop space where Dell has the efficiency edge.