Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: rudedog who wrote (127385)	5/20/1999 3:48:00 PM
From: Meathead	Read Replies (1) \| Respond to of 176387

Re: Based on analysis, GM hit not a one time event. Kevin Rollins himself stated in the CC that this was not a 1 time event as well. He encouraged analysts to get used to this type of margin and use it in future pricing models. MEATHEAD

To: rudedog who wrote (127385)	5/20/1999 8:10:00 PM
From: jim kelley	Read Replies (1) \| Respond to of 176387

Dog, I read that opinion. This analyst also assigned this increased expense to the SG&A. I am not an accountant but it seems that the added expenses for manufacturing personnel should go COGS as a manufacturing variance cost. Sales support staff costs should go to SG&A. Also, another analyst (during the CC) pointed out that the revenue per employee was down. The response was that they needed to add personnel for the Tenn factory etc. The Tenn factory needs about 1000 trained employees. Again this is not a detailed disclosure so all we know is that cost are up somewhat due to personnel. I am going to look at this in more detail with some additional information I have collected. Other unconfirmed disclosures have margins in China and South America half that of the US. Hmmm... could CPQ have been dumping PC's there like they were doing in China??? That would have negative effect on DELL's overall margins. Even so Meredith expects the overall margin to remain the same for the rest of the year. Anyway this is a complex problem and being off by a 100M here and 50 M there will throw the whole analysis off. There is no substitute for credible company guidance because the possible explanations are wide ranging as I am sure you learned with your EP experience last quarter. Sounds like a monumental war going on the PC universe!