My response to William is no way -- don't even think about it. Dell is NOT Apple.
Apple is a growth story with multiple legs to it. From the iPod to the iPhone, the new Mac and its attendant software, to, of course, the incredible retail store system that numbers more than 200 strong, globally, Apple is a true growth story for the next several years. Apple has another thing going for it: terrific and expanding margins.
Dell, on the other hand, is competing in a commodity business whereby the only major advantage is competing on price. With lower prices come depressed margins and compressed P/E ratios; not a good formula for a growth company. Sure, Michael Dell's return brought some near-term enthusiasm, but the numbers are the numbers. He can clean up the expense side of the equation, and that certainly is worth some share value, but at the end of the day -- it's a commodity story.
Personal computers and servers, once the trail blazers of the technology world, have been reduced to easily replaced, interchangeable commodity products. The good news for consumers and businesses is that price points have dropped significantly while functionality and power have gone up. The bad news for major manufacturer Dell is operating margins have been struggling to hold onto the 5-7% level.
So William, I am impressed with your determination to improve your current portfolio -- but please, not Dell. Apple is the buy while Dell is the sell.
Georges Yareds' new Report "7 Reasons Apple Will Double" is available free at GameOn.com. He is CIO of Yared Investment Research.
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