Had said it all along some time ago, the big boys will follow with the quote "stiff competitions", now they come. Look for CSCO to drop below 100 and stay there for some time. imo.
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Dell Falls After Wall Street Earnings Outlooks
NEW YORK (Reuters) - Shares of No. 4 computer maker Dell Computer Corp.
(Nasdaq:DELL - news) fell sharply in heavy trading Friday after investment houses said the
Round Rock, Texas, company would meet fourth-quarter earnings estimates but could slip
below sales expectations due to stiff competition.
Clocking trading volume at the rate of a pinball score, Dell stock was at $91.75 in midday
trading on Nadaq, down $10.125 from the previous day's close.
Prior to the open, BancBoston Robertson Stephens said Dell's fourth quarter finish was
soft, and would lead to revenues of $5.2 billion, shy of its earlier estimate of $5.5 billion.
The brokerage house cited competition in the U.S. corporate desktop and large server
computer market for the expected shortfall.
Robertson Stephens said it expected Dell to meet the consensus fourth quarter earnings
estimate of 31 cents per share when it reports fourth quarter numbers Tuesday after the
market closes. Credit Suisse First Boston said Dell was ''on track to meet or beat'' its
fourth quarter earnings estimate of 31 cents per share.
Dell, the No. 1 direct seller of PCs, is best known for its sales model that allows customers
to cut the cost of a computer by ordering it straight from the factory floor. Dellofficials were
not immediately available for comment.
Salomon Smith Barney said it saw rivals Compaq Computer Corp. (NYSE:CPQ - news),
Hewlett-Packard Co. (NYSE:HWP - news) and International Business Machines Corp.
(NYSE:IBM - news) making progress toward the so-called ''Dell model'' in the company's
key large accounts market.
Salomon said it was ''comfortable'' with its 31 cents share earnings estimate, but did not
expect more than ''several pennies of upside'' on the number. The brokerage said it may
have set its outlook for Dell's selling price too high given recent corporate-market
competition from Compaq, Hewlett-Packard and IBM. |
