Dell postpones analyst meeting
Move catches some Wall Street analysts by surprise.
By Dan Zehr
AMERICAN-STATESMAN STAFF
Tuesday, February 21, 2006
Dell Inc. today postponed its annual meeting with stock analysts, less than a week after saying it would use the meeting to provide Wall Street with more details on its strategy.
The company told analysts in an e-mail that it would delay its usual April meeting until September and return it to New York from Austin.
"There was some reflection, and it was determined that (if we would) meet again in five weeks, we would not have much to tell analysts that was different from what we spoke about last week," when executives discussed Dell's fourth-quarter results with analysts, said spokesman Jess Blackburn.
"Just in terms of a bigger formal gathering, the feeling is that there will be a lot more to share regarding our strategic initiatives at that time," Blackburn said.
The postponement surprised several analysts, who had expected that Dell would use the meeting to lay out its strategy to re-energize the company's sales and profit growth.
Dell sent out reminders Feb. 3 to analysts to reserve the April 5-6 dates for the meeting. As recently as Thursday, when Dell issued its fourth-quarter results, top executives were referring to the April meeting and saying they would use it to provide more in-depth guidance on several issues.
"It's pretty clear that a lot of the changes going on at Dell are probably bigger than normal and will take a little bit longer than just a short period of time for them to be able to put their arms around and embrace," said Laura Conigliaro, an analyst at Goldman Sachs. "Dell is probably making a very plain statement with this meeting change that these are shifts, however small some of them might be, that in the aggregate are going to take a lot of time."
Goldman Sachs has provided investment banking and conducted other business with Dell within the past 12 months.
Dell's spring meeting, which until recently was held in New York, goes back nearly a decade. The company also hosted a fall meeting in Austin each year, but in 2004 it switched to a single, spring meeting held in Austin. Dell's decision to postpone the meeting comes as analysts have been questioning the company's growth prospects. The company missed revenue expectations in two of the previous three quarters. Dell beat Wall Street's expectations for its most recent quarter, but its forecast Thursday for the current quarter was below Wall Street's estimates.
Meanwhile, analysts have been talking up Hewlett-Packard Co., the No. 2 computer maker behind Dell. Under new CEO Mark Hurd, H-P reported solid earnings in its most recent quarter, including a better-than-expected profit margin on its PC sales. The company's shares reached a five-year high of $34.52 following the announcement, which included a strong forecast for the current year.
Dell shares, however, fell 5 percent Friday in the first full day of trading after its results and forecast were announced. The stock was down 2 percent to $29.81 today before the announcement of the meeting change.
dzehr@statesman.com; 912-5932 |
