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$8.71 -0.06 (-0.68%)
9/5/2008 4:00 PM

PC Mall, Inc. (MALL)

CAPS Rating:
***

The Company together with its wholly-owned subsidiaries is a direct marketer of computer hardware, software, peripheral, electronics and other consumer products and services.

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Avatar NetscribeComptrs (84.06) Submitted: 1/03/07 1:24 AM : Outperform Start Price: $10.71 MALL Score: -6.14

PC Mall, Inc. (MALL) is a rapid response, direct marketer of computer hardware, software, peripheral and electronics products. MALL offers products to business, government and educational institutions, as well as to individual consumers. It sells products using direct marketing techniques, direct response catalogs, dedicated inbound and outbound telemarketing sales executives, the Internet and three retail showrooms.

MALL recently acquired the products business from Government Micro Resources Inc. This acquisition provides the company with a much more seasoned sales force in its government segment. Additionally, it brings high-end products into MALL’s product line-up and allows the acquired salesmen to sell its existing lower end products. Due to this factor, MALL’s government business has grown more than double in size. Further, it won a 3-year, $100 million blanket purchase agreement to provide IT products.

The company is largely selling products of world known giants Apple, Hewlett-Packard, Microsoft, to name a few. These companies are into expansion spree and bringing in user-friendly and technologically advanced products which are likely to be in demand going ahead. Further, MALL operates in an industry that has narrow margins. Nevertheless, the company has identified this glitch and is cutting costs. During the third quarter 2006, the company’s selling, general and administrative expenses dipped by 2.45% and gross margins and net margins improved by 95 basis points and 69 basis points respectively, as compared to the same period last year. On the back of strong fundamentals and growth oriented strategies the stock will zoom, going ahead.

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Avatar walbert78 (89.72) Submitted: 4/15/07 9:47 AM

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Yes, the company is in direct competition with CDWC; one of Motley's picks in past issues. I chose PC MALL, not only because the company is experiencing rapid growth but because my company purchases several items from PC Mall. As a matter of fact, we have purchase several millions dollars worth of computer equipment, telecommunications equipment and software. I suspect it will continue to grow.

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Avatar NetscribeComptrs (84.06) Submitted: 5/14/07 6:58 AM

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Consolidated net sales increased 10% to $256.8 million for the latest reported quarter supported with decline in SG&A spending, reduced labor costs from its Philippine initiative and increased advertising efficiency. Public sector sales greatly benefited an 80% increase in sales from the acquisition of GMRI’s product business that was acquired in 2006. The quarter also witnessed the award of several key contracts from Los Angeles Department of Water & Power, OEPC and The Oregon Educators and Teachers Consortium for the division.

Moreover much focus is on the small and medium business (SMB) customers for which there has been an expansion in the online commercial side. The SMB segment sales increased by 18% supported by the improvement in sales productivity that resulted from the maturity of the Montreal sales force. The segment is exploiting the low cost operations in the Philippines region and has also implemented a new quote management system design to support productivity in margin initiatives.

PC Mall is a direct marketer of computer hardware, software, peripherals, electronics, and other consumer products and services. Historically the second quarter of the company has been seasonally strong with support from state and local government sales and the third quarter benefits from the federal government order.

The management views the release of Adobe Creative Suite 3 which takes advantage of Apple's transition to Intel processors as potentially significant event for PC Mall's Mac-Pro customer base. It is very bullish waiting for the release of the OS X Leopard in the fourth quarter that would create additional apple related sales opportunities. PC Mall also remains open to strategic acquisitions with bright hopes of another positive year in the making.

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