Whitney Tilson Still Adores Dell, Microsoft

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Whitney Tilson Still Adores Dell, MicrosoftHedge fund manager Whitney Tilson explains why he likes Dell, Microsoft and JC Penney.


how he’s trading groupon and the stock he says is one of thetake a look at hp. do you think there will be a breakout? we’ve been pricing it rather aggressively and i would say all in at this point. and i think the expectations have been reset. meg whitman has done a good job and you’re looking at a technical breakout potentially. you have gains in market share in both servers and services side. you’ll get earnings next week and i think the street is just too low. this is an incredibly cheap stock.this is like a microsoft. i think reprices higher. when we last spoke, i recall i said we looked at it, had a little too much hair on it and dell was just as cheap and both stocks have actually had nice moves up. so we still like dell and microsoft. but every value guy i know between cisco, oracle, intel, hewlett-packard, dell and microsoft and apple, they own two or three of those and they’re all sort of cheap. and so congrats on hewlett-packard and we think dell is interestingly cheap. they see limited up side given the fact the stock has moved more than 20%. you disagree. certainly i’m lessen news i can’t say tick at 18 rather than 20. at 18, any actual got $4.5 a share. jcpenney another one of your winning bets. there are so many stocks thatyou have long bets on at this point that have moved sosignificantly higher as the overall market has, as well. it’s your fourth biggest position. how much offer play there has to do with ron johnson? i’d say that’s 90% of it at this point. so you’re betting the house on ron johnson. initially we bet on them doing smart things and the key smart thing was hiring ron john so that. and as we looked in to him and what did he at apple, we said, wow, take a look at this. it’s not a bad company, but it has quite low sales, high expenses relative to peers. jcpenney spends twice as much on advertising as target. so we have to figure that this is an underperforming, undermanaged business that just got the two best retail guys got the two best retail guys.they’re working as a team together on an underperformingbusiness. we have to think there’s a lot of up side there. so we’re not valuing it based on trailing 12 month earnings.because on that basis, we admit doesn’t look cheap.

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