David Lentz

Dell: Market Pessimism Presents Buy Opportunity

If you are looking for out of favor depressed stocks to pour money into, there's an entire financial industry full of them.

Just because a company has had a great past, does not mean that their future is similarly aligned. Just ask Microsoft stockholders. Or Bear Stearns. Outperforming is the key to advancing, and I see no distinctive competencies in Dell that are not in abundance in their competition.

Dell's problem is not, in the main, competition from Apple. It is that Hewlett Packard is chewing it up in its main market, corporate America. The stigma of poor service lasts long after the problem has been corrected, and Dell will have to significantly undercut HPQ in product pricing to get a chance to rise off the mat. I don't see HPQ giving them that much breathing space.

You will know if Dell's turnaround strategy is working when cash flow and profits improve. Dell's formula has always been built around maintaining minimal inventories, so even if they do run short of product for brief periods of time, it is not necessarily a sign of blow-out sales volume.

Three Reasons I Chose Microsoft over Apple for Home Media

Thomas, in the interests of full disclosure, how many of your Xbox360's have you replaced under warranty?