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Technology Stocks : Dell Technologies Inc.
DELL 119.68-0.6%3:59 PM EST
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To: GVTucker who wrote (165153)5/7/2001 5:05:57 PM
From: t2  Read Replies (2) of 176387
 
and those extra shorts were short as of 15 April, when the price of was yet another $1 higher than the current price

Now, instead of preserving profits, they will be trying to cut their losses.

Profit margins higher than anticipated is the key statement that will result in the short covering.

There is no doubt that is the most significant part of the whole press release. Meeting EPS is no big deal, IMHO. .

So many were expecting the margins to deteriorate. In Dell's planning they allowed for a certain amount of drop in margins but now we realize that they actually could have cut prices even more to hit their targetted margins..but did not need to.
Extending that further:
If Dell could meet targets without more price cutting, that also means they can do it for the next quarter. That is the way I would interpret that. They are succeeding with less cuts than they needed to hit targets this quarter and I would bet they are already on track for the next quarter for margins. Remember, the stock is trading down on future expectations of weakening margins. This suggests that they margins won't get much weaker, if Dell does not want it to. They call the shots in the PC sector, no doubt about it.
To me this is a BIG turning point in sentiment for this stock.

Make no mistake, this stock is going up. This is NOT just about meeting revenues and EPS.

There will be some serious short covering. I also believe Dell left a bit more positive news for the actual earnings.

IMHO of course.
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