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Thoughts on DDR / DTL for AI please

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Thoughts on DDR / DTL for AI please

Hi James, There is so much noise and information spinning around regarding AI entering our lives. I believe we all need to pay attention to how it will affect our lives and the way we invest in stocks on the ASX. Two companies I am hearing a lot about are DDR and DTL which are enablers within the AI realm. They will play a key role in enabling the adoption of AI in Australia as suppliers of hardware and software DDR, and services to assist in implementing AI tools and functionality DTL according to several analysts. What are your current opinions and analysis of these two stocks please? They both pay a fully franked healthy dividend and both have been around for many years moving with the times. Loving how MM is teaching me how to build a healthy portfolio. Thank you.


Hi Maureen,

Dicker Data (DDR) $9.44 – the second mention for the hardware & software wholesaler  DDR today, as we said previously the stock has trended lower since 2021 and we wouldn’t be surprised to see it retest $8. Its yield in excess of 5% seems attractive, however a stock paying a large proportion of earnings as a dividend, we doubt, will be at the forefront of AI.

  • The Q1 sales released last month was a miss and the stock fell accordingly.

Overall we do believe DDR is a well-run business and one quarter does not make a trend; however, the quantum of the sales decline combined with the founder selling in March
(10% of DDR’s issued capital to settle a divorce) could limit investor interest until a rebound in sales is visible.

Data#3 (DTL)  $8.20 has experienced a tough 2024 after  Februarys result missed consensus earnings by -6% which saw the stock plunge 20% and it’s struggled to recover since. We believe the stocks fair value ~$8 while its premium to DDR and offshore reseller comps, is fair given DTL’s relatively defensive revenues, higher returns on capital and strong cash flow profile.

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Dicker Data (DDR)
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