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

To: OLDTRADER who wrote (113783)	3/31/1999 10:35:00 PM
From: puborectalis	Respond to of 176387

Merrill Lynch analyst Steve Milunovich is positive on the PC sector, which has taken a hit recently from reports of weakening PC sales. "We think [PC] stocks could bounce near term as March looks better," Milunovich said in a report Wednesday. The analyst said he favors Dell Computer over Compaq Computer because it has a superior business model. Milunovich also favors enterprise computing companies such as EMC and Sun Microsystems. However, the analyst is concerned about falling PC prices. "The emergence of low-priced PCs from eMachines and others suggests that pricing pressures will heat up," he said. Milunovich expects PC prices to fall at least 5% to 10% a year, and he expects major PC makers to offer $500 machines in the second half this year. "This ASP [average selling price] pressure isn't good for anyone, but we think the indirect vendors are most vulnerable: Compaq, Hewlett-Packard and IBM," he said. Already, California-based eMachines, which sells PCs for less than $600, has become the fourth-largest seller of PCs in U.S. retail stores, behind Compaq, Hewlett-Packard and IBM, according to PC Data. "The idea is to reopen the first-time PC-buyer market as well as [prompt] purchase of second PCs for the home through rock-bottom prices," Milunovich said.