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

To: nolimitz who wrote (113313)	3/29/1999 9:20:00 PM
From: Walcalla	Read Replies (1) \| Respond to of 176387

here is the article. By The-Adviser.com - Monday, 3/29/99 originally issued 3/29 VISITORS New York - Name brand desktop computers will shortly be priced at $299. We expect that as the summer nears - there will be a major seasonal slowdown in computer sales that will have negative short term implications for computer stocks. We spoke with management from a variety of technology companies and their customers. Here is our report. Intense competition within the PC industry will result in additional consolidation (Dell & IBM). There are more than confirmed rumors of another major restructuring at Compaq. It is increasingly clear that Hewlett Packard will have difficulty completing a spin-off. Services and diversified companies such as IBM, NCR and Wang will benefit as technology investors look to maintain their portfolio weights in other stocks. Close to 50% of US households now have a computer in their home. Semiconductor companies such as Intel have tremendous capacity to make old but still acceptably fast computer chips and software requirements are increasingly being handled by these older technologies. The fear of Year 2000 implications will result in delayed spending as last minute preparations will increasingly require management attention. We believe that the combination of these events will result in mainstream entry level computers priced at $299 by the 1999 Christmas/Holiday seasons. Fully functional portable notebook computers will also be priced beneath the $1,000 level. We believe that this intense price pressure will have a significant and negative impact on computer hardware related stocks over the next three to five months. This includes companies such as Compaq, Hewlett Packard, Sun, Dell, and Seagate. Technology companies that have strong services and complete solutions such as IBM will fare better. We expect stocks such as America Online and Microsoft to decline slightly but may benefit for the same reasons noted for IBM, NCR and Wang. Our expected decline is 15 to 20%. We caution against purchasing large blocks of such companies prior to this decline. Investors who currently have large profits in hardware related technology stocks will benefit by reducing their holdings. Patient investors who can wait for these major price declines will benefit significantly. Once prices have stabilized, investors should begin dollar-cost averaging purchasing programs. We expect that growth will eventually be energized by new users, second users and international sales. This will begin the next major wave of computer growth. College and high school students will also fuel sales of low priced portables computers and printers. Students will want their own computer and parents will buy them. We expect that by the late summer, Comp USA will also be an excellent value.