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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Earlie who wrote (46918)	2/13/1999 12:30:00 PM
From: gbh	Respond to of 132070

For the thread; Kansas commentary on DELL and Fleck, When the Dell Tolls By Dave Kansas Editor-in-Chief 2/12/99 9:27 PM ET Bill Clinton smiled today, becoming the second President to win acquittal in the impeachment process during the history of the nation. Should Wall Street care? In a word, no. The entire process of impeachment has kind of existed on the shoulder of Wall Street. While Washingtonian pundits debate the next stage of the scandal process, Wall Street is fixated on its own Super Tuesday. After the three-day weekend, one of the most important bellwethers in techland, Dell Computer (DELL:Nasdaq), will report its earnings. But concern is mounting that Dell, the ever-growing stock, may finally be running into some difficulty. On Friday more worries about Dell's earnings surfaced and the stock slid sharply, losing 12 to 89 7/8. While big generals like Microsoft (MSFT:Nasdaq) and Intel (INTC:Nasdaq) are crucial tells for this tech-led bull market, a stock like Dell goes to the heart of the enthusiasm for technology stocks. Magnificently successful, Dell's stock has soared from a split-adjusted level of about 2 at the end of 1995 to a recent high of 110. Doomsayers have often said that Dell can't continue growing forever, primarily because it sells a product, computers, that continue to face intense pricing pressures. But each time the doomsayers bark, Dell delivers a surprisingly strong number. Given Friday's skid and the growing whispers that Dell will not deliver on its earnings Tuesday, worries are growing that the company's good run may be coming to an end. That fear is viral, and it could be seen ripping through the tech-heavy Nasdaq on Friday. Few tech stocks found relief in the onslaught. Even on TheStreet.com the debate has grown in intensity. Columnist Herb Greenberg warned earlier this month that Ashok Kumar, an analyst at Piper Jaffrey, thought that Dell might have a lighter-than-expected quarter. At the time, Kumar and Greenberg were roundly pilloried by readers. On Friday, more investment analysts weighed in with concerns, lending more credence to the Kumar view. Two things could be happening right now. One, Dell is in a real heap of trouble, losing ground to rivals like Compaq (CPQ:NYSE) and IBM (IBM:NYSE). This kind of competitive warfare is not good for anyone's profit growth. And if Dell is suffering in an increasingly competitive environment, it is going to spell trouble throughout the important computer sector. But I would ask you to consider an alternative. Michael Dell, like many technology company executives, has a shrewd understanding of Wall Street's expectations game. Perhaps he, or his allies, are sowing doom throughout Wall Street in an effort to "surprise" investors with what otherwise would be a mundane or potentially ugly earnings report. Whatever the case, Tuesday's focus will be squarely on Dell and its earnings. It will hold the key for technology stocks, not to mention the broader market. If the doomsayers are accurate, Friday may be but a foretaste of what is to come in the shortened week. Slate Debate: Did battle with Bill Fleckenstein about the bubble issue this past week on the now-free online magazine, Slate. According to the poll, I was unable to convince the Internet intelligentsia that we're not in a stock market bubble. It's a bummer to get whupped, but at the same time, one would have to argue that the contrarian nature of sentiment readings would argue in favor of the stock market.