Saturday, December 16, 2006

Dude, You Need to Buy Some Dell Shares

With such a rudimentary phrase famed by the famous commercials of years past, Dell has been one of the most prominent kings of computer production. However, while this large cap stock has remained relatively stable during the last five years, 2006 proved to be an onus to Dell shareholders with continued amounting capital losses as the stock neared a five year low. However, if you look pass such negativity and focus on trends and technical analysis, you will convincingly find Dell as a bargain for a price under 25 dollars.

Typically during the fourth quarter of seasons end, Dell prices have followed an upward trend towards large capital gains. Such achievement is usually attributed to strong fundamentals which spawn from the sales from the company's popularized notebook and desktop computers along with accessories during the back-to-school months of August through October. With such a seasonal increase in revenue and profit, transcending to earnings, the outlook for Dell shares characteristically remain strong through the fall and winter months. The last five years have proven to provide such evidence as shown through technical assistance. Last year during this time period, the stock increased nearly 10%, the year prior to that: 20%, during 4th quarter 2003: 5%, 4th quarter 2002: 15%, and during the 4th quarter of 2001, when the price of Dell was at a number similar to this year, the price went up nearly 100% for the duration of that period. One of the key fundamentals in making profits with equities is to follow trends, and Dell provides a positive inclination which will inevitably yield high capital gains.

While an argument can be made that the economy is showing some indication of a slowdown which is not favorable for technology stocks, during 2001 and 2002 when similar accusations were held, the price of the stock did not adversely heed such information and garnered gains at a rapid pace. With a price near the 20.00-25.00 range, and with the prospect of an exciting fourth quarter ahead, I look for Dell to prove many critics wrong when smart investors are racking up a cornucopia of profits around January.

With such a rudimentary phrase famed by the famous commercials of years past, Dell has been one of the most prominent kings of computer production. However, while this large cap stock has remained relatively stable during the last five years, 2006 proved to be an onus to Dell shareholders with continued amounting capital losses as the stock neared a five year low. However, if you look pass such negativity and focus on trends and technical analysis, you will convincingly find Dell as a bargain for a price under 25 dollars.

Typically during the fourth quarter of seasons end, Dell prices have followed an upward trend towards large capital gains. Such achievement is usually attributed to strong fundamentals which spawn from the sales from the company's popularized notebook and desktop computers along with accessories during the back-to-school months of August through October. With such a seasonal increase in revenue and profit, transcending to earnings, the outlook for Dell shares characteristically remain strong through the fall and winter months. The last five years have proven to provide such evidence as shown through technical assistance. Last year during this time period, the stock increased nearly 10%, the year prior to that: 20%, during 4th quarter 2003: 5%, 4th quarter 2002: 15%, and during the 4th quarter of 2001, when the price of Dell was at a number similar to this year, the price went up nearly 100% for the duration of that period. One of the key fundamentals in making profits with equities is to follow trends, and Dell provides a positive inclination which will inevitably yield high capital gains.

While an argument can be made that the economy is showing some indication of a slowdown which is not favorable for technology stocks, during 2001 and 2002 when similar accusations were held, the price of the stock did not adversely heed such information and garnered gains at a rapid pace. With a price near the 20.00-25.00 range, and with the prospect of an exciting fourth quarter ahead, I look for Dell to prove many critics wrong when smart investors are racking up a cornucopia of profits around January.

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