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

To: JRI who wrote (105717)	2/28/1999 12:56:00 PM
From: TCBinAugusta	Read Replies (2) \| Respond to of 176387

Hi John, I don't see how CPQ's troubles can necessarily signal the same type of trouble for Dell. My opinion is they will in fact enhance Dell. Here's why: 1. As I have stated before on this thread, CPQ's attempt to move from reseller to online is, in my opinion, going to hurt them revenuewise because resellers will move to another vendor source not knowing for sure how they will come out in this transition, and CPQ's sales on line will not be at a sufficient level to replace these revenues right away. For example, CompUSA has already started building to order "Dell quality" PC's according to their sales staff. 2. Reuters reports CPQ's stating first 6 weeks of their first quarter revenues are down. Here is part of the article: 1-26-99: "Friday's sell-off was sparked after Compaq Computer Corp. CPQ , the world's largest maker of personal computers, said industry sales of commercial PCs had been soft for the first six weeks of the first quarter in North America and Europe. Wall Street analysts saw Compaq's weakness as further evidence of a build-up of left-over PC inventory from the heavy production cycle that occurred for most major PC makers in the final quarter of 1998." Ask yourself these questions: (a) How can Dell suffer from an inventory build up if they do not carry the inventory like other makers, (b) Dell's quarter ended in JANUARY, not December, and therefore Dell did well INCLUDING four of the six week period CPQ is complaining about, (c) I heard MD say fourth quarter revenues were down slightly because at the end of the quarter several large corporate customers delayed purchasing. Presumably, these purchases will come in 1999 Q1. 3. It looks like Dell is moving more into consumer geared PC's at the time CPQ is in transition. More opportunity for Dell. 4. There are to be still many, many Y2K purchases in the next 6 to 9 months. It now appears that Sept. 1 is a "bad" date and this should accelerate it. Like my small company, many purchases will be in Dell's Q1 for fear of lack of availability of PC specialists as we travel further towards December. I only see good for Dell going forward and would treat the recent downturn in all PC stocks as a significant buying company. All of this is only my personal opinion, of course. TCB