Read the article. It's not very bullish. Besides, Dell
screwed investors before. What's to stop them from
doing it again. I REPEAT: The PC is DEAD.
Dell Stands by First Quarter Targets
Apr 4 7:10pm ET
By Peter Henderson
SAN FRANCISCO (Reuters) - Dell Computer Corp. said on Wednesday it was maintaining its six-week-old forecast for its first fiscal quarter but would not comment on the remainder of the year due to economic and industry uncertainty.
Dell said in a statement ahead of an analyst meeting in New York on Thursday that its low operating costs and its business model -- direct sales -- gave it a competitive edge despite the overall slowdown in the computer sector.
The company reaffirmed quarterly targets of about $8 billion in revenue and 17 cents in per-share earnings, which is in line with Wall Street expectations for the period which ends in about a month.
Dell had made the same forecast when it announced job cuts and fourth-quarter results on Feb. 15, although previous to that analysts had expected earnings of 19 cents on revenue of $8.45 billion.
ABN Amro analyst Bill Shope said that Dell was keeping to its target thanks to a conservative forecast in February and the benefits of selling direct, which allowed it to price aggressively even in a soft market.
"(Dell) stands out quite a bit. The other guys are experiencing loss of market share and significant declines in profits whereas Dell is gaining market share and sacrificing a smaller amount of profits. It is the direct model. It is starting to differentiate Dell once again," he said.
Dell shares rose to $23-9/16 in Instinet after hours trade from a close on Nasdaq, before the announcement, of $22-3/16.
Dell stock has underperformed the American Stock Exchange Technology Hardware index by almost 15 percent and rival Compaq Computer Corp. by about 25 percent since the end of 1999.
Dell, which lowered forecasts five times in the past year, cautioned that the market was still unpredictable although it expected to gain share.
"Current softness in industry demand and profit margins is not a secret," Chairman and Chief Executive Michael Dell said in a statement. "But in this environment, the differences between Dell and other major companies are compelling."
The statement added: "The company believes it is profitably gaining market share and can outperform the overall computer-systems industry in the period."
It also expected solid expansion in international markets and said the Thursday conference would focus in part on higher end storage units and servers.
Dell is one of the main personal computer makers aggressively expanding into higher value computers for major corporations. |
