Higher Dell Notebook Share Expected

Notebooks and Netbooks constitute around 18% of the $17 Trefis price estimate for Dell's stock.
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Dell (DELL) - Get Report competes with HP (HP) - Get Report and Apple (AAPL) - Get Report in the notebook market. We currently have a Trefis price estimate of around $17 for Dell's stock, about 32% above the current market price of around $13.

Trefis members have created forecasts for two key drivers of Dell's stock over the last week: (1) Dell Notebooks Pricing and (2) Dell Notebook Market Share. The members' forecasts suggest that Dell Notebooks Pricing will trend in line, while Dell Notebook Market Share will trend above the Trefis estimate. These projections indicate a combined upside of around 8% for Dell's stock.

We estimate that Notebooks and Netbooks constitute around 18% of the $17 Trefis price estimate for Dell's stock. Hence the stock is quite sensitive to (1) Dell Notebooks Pricing and (2) Dell Notebook Market Share. Below are charts showing recent estimates created by Trefis members for the two drivers in detail.

1. Dell Notebooks Pricing

The average of forecasts for Dell Notebooks Pricing created by Trefis members indicated a projected decrease from around $826 in 2010 to $462 by the end of the Trefis forecast period, compared to the baseline Trefis estimate of a decrease from $819 in 2010 to around $435 by the end of the Trefis forecast period. The member estimates imply an upside of 1% to the Trefis price estimate for Dell's stock. In the past, Dell Notebooks Pricing has decreased from $1,536 in 2004 to around $862 in 2009.

Disagree? You can drag the forecast trendline above to express your own view, and see the sensitivity of Dell's stock to Dell Notebooks Pricing.

Our

complete analysis for Dell Notebooks Pricing is here.

2. Dell Notebook Market Share

The average of forecasts for Dell Notebook Market Share created by Trefis members indicated a projected increase from around 15% in 2010 to around 16% by the end of the Trefis forecast period, compared to the baseline Trefis estimate of a decrease from around 14% in 2010 to around 13% by the end of the Trefis forecast period. The member estimates imply an upside of 7% to the Trefis price estimate for Dell's stock. In the past, Dell Notebook Market Share has decreased from 16% in 2004 to close to 13% in 2009.

Disagree? You can drag the forecast trendline above to express your own view, and see the sensitivity of Dell's stock to Dell Notebook Market Share.

Our

complete analysis for Dell's stock is here.

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