Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: TigerPaw who wrote (175557)	5/19/2006 11:11:55 PM
From: stockman_scott	Respond to of 176387

Dell's cost-cutting plan ends 22-year agreement with Intel __________________________________________________________ Friday, May 19, 2006 BLOOMBERG NEWS Dell Inc., the world's largest personal-computer maker, accelerated a plan to cut $3 billion in costs and said it will use processors from Advanced Micro Devices Inc. for the first time, dealing a blow to Intel Corp. The decision to use Advanced Micro ends a 22-year exclusive agreement with Intel, the world's largest semiconductor maker, and will help Dell bolster profitability, which has flagged in the face of stiffer competition from Hewlett-Packard Co. Dell Chief Executive Officer Kevin Rollins, who reported an 18 percent decline in first-quarter profit Thursday, described the decisions as "bold moves" that responded to increased competition. The company is investing $100 million to improve customer service, and said it will stop forecasting results. "Dell is finally making some meaningful changes, which is what investors have been looking for," said Tony Ursillo, who helps manage $75 billion at Loomis, Sayles & Co. in Boston. Round Rock, Texas-based Dell earned $762 million, or 33 cents per share in the three months ended May 5, compared to $934 million, or 37 cents per share, in the year ago period. That included a charge of $77 million, or 3 cents a share, for the expensing of stock options. First-quarter sales rose 6 percent from the year ago period to $14.2 billion. It previously forecast revenue of $14.2 billion to $14.6 billion. Analysts were expecting 38 cents per share on revenue of $14.5 billion, according to a survey by Thomson Financial. Advanced Micro's Opteron microprocessors will be used in a new line of server machines to go on sale by the end of the year, Dell said Thursday in a statement. The deal gives Dell products that are winning favor with customers.

To: TigerPaw who wrote (175557)	5/20/2006 5:13:20 AM
From: stockman_scott	Respond to of 176387

S&P: Dell Deal a "Big Win" for AMD businessweek.com MAY 19, 2006 From Standard & Poor's Equity Research Dell (DELL ) : Maintains 3 STARS (hold) Analyst: Megan Graham-Hackett April quarter earnings per share (EPS) of 33 cents vs. 37 cents is in line with the preannouncement and 4 cents below our estimate. Revenues rose just 6%, hurt by pricing, but notebook, enhanced services and storage sales were still relatively strong. We were disappointed by server sales' rise of just 3%, and we view the announcement that Dell will use AMD chips in its servers as long overdue. Our fiscal year 2007 (ending Jan.) EPS estimate falls by 10 cents to $1.45 to reflect heavy investment in customer support. Given our view of potential for better traction from new initiatives, we view Dell as worth holding. Advanced Micro Devices (AMD ): Reiterates 5 STARS (strong buy) Analyst: Thomas Smith, CFA AMD welcomes Dell (DELL ) "to the world of AMD64" in a statement on Dell's plans to offer AMD Opteron Dual Core processors in server products by the end of the year. We view the entry into a previously Intel-only (INTC ) account as a big win in a series of other marketing wins. It implies strong demand for Opteron even as Intel readies a new product. It begs the question as to whether Dell might eventually offer AMD-based PC products beyond the Alienware high-end game machine, which we view as a boost to investor confidence. Our 12-month target price remains $50. Intel (INTC ) : Reiterates 2 STARS (sell) Analyst: Thomas Smith, CFA Intel encounters a marketing setback, in our view, as Dell (DELL ) announces plans to offer servers based on Advanced Micro Devices (AMD ) Opteron processors by year-end. We believe the loss of Intel exclusivity at Dell will hurt the shares. Although the effect on server processor sales via Dell might be small in the near term, strong customer acceptance of the AMD brand continues to pose challenges, in our view. We are maintaining our 90 cents EPS estimate for 2006, but lowering 2007's to $1.30 from $1.40. We are lowering our target price by $1 to $17.