Whisper, whisper.
FWIW here's new info from earningswhispers.com
One of the most anticipated earnings report each quarter is Dell Computers' (DELL), who is reporting after the market close today. Dell has consistently beaten estimates, but has fallen short of the whisper numbers the past few quarters. But this quarter, there have been some negative "whispering" among the analysts, though most of it has been made public. The loudest whisper came from Dan Niles, who follows Dell for BancBoston Robertson Stephens. Niles stated on Friday that he expects sales to fall short of the estimated $5.5 billion by about $300 million. His reasoning is due to increased competition in the corporate market and direct sales, primarily from Compaq.
Niles' comments were followed by an announcement from Salomon Smith Barney and CS First Boston stating similar concerns. All three expect earnings to be inline with the consensus estimate of $0.31 per share. It is uncommon for analysts to make such a strong public announcement that close to earnings without knowing some solid numbers. Therefore, we lowered our whisper number to $0.31 on Friday down from $0.33.
Despite the loud statements made on Friday, the large number of those closely following the company are much more optimistic. The majority of our sources especially don't agree with the analysts' statements made on Friday and have been referred to as the silent majority. It seems that while sales of desktop computers to corporate users might have been flat this past quarter, sales of higher-priced servers and notebooks have been strong. In fact, we have heard that overall revenues will be strong while earnings will be held back somewhat by increased expenses such as marketing - quite the opposite of what the three analysts said on Friday.
At the high-end of the whispering is the hope based on what Intel (INTC) and Microsoft (MSFT) did this past quarter. Both companies soundly beat their consensus estimates recently, and the thought is that Dell is the primary reason. Therefore, between the analysts who made their comments on Friday and those with high expectations, the range of whispers is $0.31 to $0.37. For conservative reasons, we have posted the $0.31 stated by the analysts on Friday. However, the true, or consensus, whisper number is $0.33.
There are 25 analysts following Dell, with the top estimate being $0.32 and the low estimate being $0.28. The consensus estimate for the current quarter has not changed since Dell reported earnings last quarter of $0.28. After adjusting for splits, Dell has beaten the consensus estimate by one cent four out of the last five quarters.
You might also note that Prudential Securities reiterated a strong buy recommendation today. You can hear Dell's conference call online starting at 5:30 PM EST at dell.com. You will also be able to see the earnings report around that time at stockselector.com.
Some related companies are also reporting earnings today. Most significantly are Applied Materials (AMAT) and Hewlett-Packard (HWP). Applied Materials is expected to report earnings of $0.06, while our whisper number is $0.07. Some are expecting AMAT to report earnings of $0.08. The range of estimates among the 22 analysts following AMAT is $0.02 to $0.08.
Our whisper number of Hewlett-Packard is $0.89, which is one cent above the top analyst's estimate of $0.88. The consensus is $0.83 and the lowest estimate $0.80.
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