Dell Computer Corp shares are a good buy because the company is expanding its share of the PC market and adding products, an officer of the largest public-employee investment fund said.
The shares of Dell, the biggest direct seller of PCs, remain a good investment, even as the price has increased in recent months, said Mark Anson, senior equities investment officer for the California Public Employees' Retirement System. Dell shares have gained 53 percent this year.
Dell has taken business away from rivals, including Compaq Computer Corp and Gateway Inc, by slashing prices amid declining demand for PCs. The company is introducing products, such as networking gear, Anson said.
"Despite declining PC sales worldwide and in the US, Dell was the only PC maker to increase its market share," said Anson, who helps manage US$157 billion in investments. "This is a company that can weather the storm."
Dell shares rose US$0.05 to US$26.61. Calpers owned more than 9.5 million Dell shares as of March 1.
"I liked them a few months ago when they were in the US$22 to US$24 range," Anson said. "I like them today when they are in the US$28 to US$30 range. Maybe not as much as I did when they were in the low US$20s."
Dell began cutting prices late last year. PC prices have declined as much as 25 percent this year as rivals also reduced prices to remain competitive, according to researcher International Data Corp.
Anson said investors should avoid shares of Palm Inc, which makes handheld computers. Palm shares have fallen 82 percent this year, the second-worst performance of companies in the Standard & Poor's 500 Index, because of unexpected losses and falling sales.
"This is a company that's on life support, it's close to cardiac arrest," Anson said. "The best thing you can say for Palm right now is that maybe it's a stock in play at these low prices. Maybe it's an attractive acquisition candidate."
Palm shares rose US$0.06 to US$5.12.
RSS