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

To: Labrador who wrote (86287)	12/20/1998 8:06:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

Bob, you said she has doubts on DELL's ability to keep up its staggering growth trend -- can they keep going? Of course your wife is right (apart from the obvious: women are always right, I know this because women always tell me so) -- no company can continue to do that. If we consider earnings as a surrogate for free cash flow for the moment (it isn't, but let's assume it is), then you cannot have a company's capitalized value increase faster than its cash flow for long periods of time. It can happen in the short run because the company may be "undervalued", or the investment community might consider that the company has not yet attained a certain critical mass necessary for decreasing its assessment of the riskiness of the company, but over the long run there must be some sort of convergence. Ultimately, as Dell gets big enough that convergence will occur at the growth rate of the over-all computer market. In the meantime, growth is fueled by Dell taking market share from competitors. TTFN, CTC