Jim-
I think you are being, to be kind, "incomplete" when saying that the quant guys predictions (for Dell's growth) have not changed..
EPS forecasts has been altered from $ 1.08 (for fiscal year 2000) to $ .88 since Dell's announcement(s), or a change of around 19%...that is significant...(to check out current consensus estimates, go to Nasdaq.com)..look at how many have been lowered (listed), as well....
Now, the good news being...IF Dell has guided analysts to these lower numbers IN ORDER TO to beat the next two quarters (by a good margin)...then, the reality is, growth is not slowing that much...somewhere in the mid-30's/high 30's (revenue, earnings, EPS)....However, if Dell can only manage to meet, or barely beat..current EPS estimates...then we will have witnesses a pretty good slowdown in Dell's growth (albeit, still a nice rate...)...at .17 (Q1, '00) and .20 (Q2, '00)...current consensus EPS estimates are either way low, or Dell really does have a problem...
Also, on the revenue side...how can you say (not much has changed?)... Dell has NEVER used the figure "30%" before....surely, many analysts have lowered their models (closer to this figure)..the "38%" you mentioned is either Kumar or Mazzurelli (sp?)...but NOT the majority of analysts..
Again, if, in hindsight, it becomes clear that Dell has done all of this in order to set an easy bar to jump over, as Meredith ("Clearly, we're trying to calibrate expectations and get more leeway to manage thru these turbulent times") and MD ("We are trying to set more reasonable goals, and ones that we think you are more comfortable that we are going to meet) have indicated DIRECTLY in their comments...then much will be forgiven...
Quite honestly, if Dell DOESN'T beat the next two quarter's CURRENT estimates handily...I certainly would question holding on to my remaining shares...It would mean that either Dell's management really doesn't have a handle on how fast the company can grow and/or there has been a permanent, significant slowdown in the company.......However, management (with quotes above) has basically admitted that they are setting the bar intentionally low....
I AM betting Dell does beat the analysts expectations handily....however, to get the stock moving, Dell needs to come out with less "same old, same old" and more indication of where the new, great future growth ops are going to be....Time for MD & co. to step up to plate and deliver.. |
