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

To: stock bull who wrote (98754)	2/13/1999 2:51:00 PM
From: Sig	Read Replies (1) \| Respond to of 176387

<<< Yes, I believe there is a good chance that Dell will snap back on Monday so it opens higher on Tues morning >>> Yes Stock Bull, I was joshing to the extent that stock prices can change radically between the close (Fri) and the open on the next trading day. Now Pat and Gabriel make good estimates of Dell earnings, so let an amateur try: Assume the following:( Fairly close to actuals) Shares 1.4 bil Sales 5.4 bil Margin 8% Then Earnings= $432 mm or ~31 cents (equals consensus) Despite about 14 reasons presented by analysts as to why margins would drop for computer makers, margins for Dell increased last quarter. A margin of 8.1 % would provide earnings of $437 mil or 32 cents beating the consensus by 1 cent This is no problem, IMO its going to happen( beating est) With Dell's newer business ventures, servers and mass storage, which have provided other companies with ~30% returns, Dell can achieve greater than 8% margin. And here we get into some guesswork. If Dell's new business was 10% of sales with 20% margins Dell would have a blow-away earnings report with earnings $65 million above the estimate, or 34.6 cents and a 15%'surprise' ( the 20% margin is debatable, because Dell gives the best possible bargain to first-time buyers) I have practically nothing to go by in estimating what the the newer ventures amount to in percent of sales, and do not believe those analysts do either. Am merely showing that the estimate of 31 cents can be beat. It has been beat for 17 (?) quarters, and will be beat again. * See Gabriel for detailed estimates(G) Sig