DELL - Dell Inc.

has a bit more room to fall imo.

:-/

i'm buying into some nov calls. lots can change btw now and then...

Looks like it might a have a short term bounce in her soon..........other than that I don't have an opinion



CNNMoney.com
Analyst: Now is the time to sell Dell
Friday April 21, 10:24 am ET

Dell stock tumbled Friday after a Wall Street analyst cut his rating on the nation's largest maker of personal computers.

Dell shares sank more than 3 percent in early trading on Nasdaq.

Citing an erosion of the company's long-time advantages when it comes to pricing, Citigroup analyst Richard Gardner issued a sell rating on the stock. Gardner, who previously rated the stock a buy, cut his price target to $28 from $37.

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"Dell management has been vocal that the business model functions optimally when PC and server units are growing above market - this has not been the case for several quarters," he wrote in a note to clients.

Falling PC prices and increased competition from resurgent rival Hewlett-Packard caused Dell to issue disappointing sales outlooks for two consecutive quarters. Dell stock tumbled 28 percent last year while shares of HP soared 38 percent on the heels of a major restructuring under new CEO Mark Hurd.

Citigroup's Gardner wrote that Dell's challenges last year stemmed from its competitors, who closed the gap between themselves and Dell during the past five years by reducing their inventory lead times.

Dell, which only sells its PCs directly to consumers via phone or Internet, boasted a famously efficient supply chain that only required a few days' worth of raw materials and "work in progress" inventory.

According to Gardner, over the past five years, Dell's competitors have emulated its model and improved their "build to order" capabilities, allowing them to cut inventory.

But he estimates Dell's direct sales model still gives the company a 10 percent cost advantage over its competitors.

Gardner adds that Dell is also exposed to the slowest-growth segments of the PC market, such as mid-sized corporate, government and education buyers in the U.S., Western Europe and Japan. At the same time, Dell has no significant exposure to rapidly growing consumer markets outside the U.S., Gardner wrote.

The analysts concluded that Dell needs to reinvest in important areas such as post-sale support, particularly with consumer and small business customers, as well as to price more aggressively versus competitors to try to gain market share.

"In our view, it would be preferable for Dell to reduce margins, and even near-term growth, rather than destroy 20 years of brand equity," Gardner wrote.

Gardner does not own shares of Dell, but Citigroup does investment banking business with the company.

Lenovo turns slowly toward U.S. consumers: Click here.

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I really like DELL at these lower prices.

Now that they own Alienware, they have an in to the AMD chip market. Between DELLs XPS line and now Alienware it looks like DELL has a good hold on the high-end PC market.

I own both Dells and Alienwares and from my experience, I have had great CS, and both build solid computers. Companies like these build a large following of loyal users that will continue to pruchase from them for years to come. I hope to put a few shares away each week for the long term.

Id like to hear what others think as I am still new to the market and this is just my personal opinion.

it's up from here, I think they hit their low. Time for rebound!

Dell

Dell gapping down today.

News that they are recalling 4 million laptops.

I won't be shorting it but it should be good to watch.

I think if you wanted to daytrade you could come in AH and short then clean up by 10am.

That's a risky move though. Be careful.

ITM sept puts would be my move here.

Only recall on battery, this won't hurt Dell they are acting responsible which customers like.
Other companies using same battery pack are taking the low road and not recalling.
Short those jerk offs.

Hahahaha.

Well yes and I just read too that they're reporting earnings on the 22nd I believe, which you don't want to be in for.

They already stated that they are going to be pretty low, so the price is built in. They should'nt fall more on earnings.

Sony makes the batteries, and they said they'd pay for part of the recall.

Checkem out.




EDIT:

up after hours now. Hmmmmmm.

EDIT:

now back at reg level. 20.91.

20 puts.

I'd say a buy, since Sony is the Battery maker, and Dell is letting people know that Sony made it.

Dell releases earnings after the bell today.

Whater you guys thinking????

They've taken a beating with all the recent news.

Hewlett Packard's earnings are up.

I'm thinking we should buy some calls.

Isnt HP's profit is mainly due to the Cost cutting efforts by that new CEO.?

Also DELL's share price has rose quite significantly in the last couple of trading sessions.. So, I am not sure, how the market is going to treat DELL's earnings..

HPQ did do cut backs and it proved to do well but it also showed them taking market share from dell plus a buy back plan.

This will hurt DELL

Dell Reveals SEC Probe; 2Q Earnings Down
Friday August 18, 12:39 am ET
By Matt Slagle, AP Technology Writer
Dell Inc Reveals SEC Investigation; 2nd Quarter Earnings Plunge 51 Percent

DALLAS (AP) -- Dell Inc., already limping after a massive laptop battery recall earlier in the week, had more bad news for investors in its second-quarter earnings report.

And it wasn't just the 51 percent decline in net earnings. The Round Rock, Texas, computer maker also revealed that federal regulators with the Securities and Exchange Commission have been investigating its accounting for the past year.

Though Chief Executive Kevin Rollins shrugged off the probe, investors appeared concerned as Dell shares fell $1.25 in after-hours trading Thursday evening. The stock closed up 7 cents to $22.80 in regular trading Thursday on the Nasdaq Stock Market.

In a conference call with reporters, Rollins said Dell received a letter from the SEC in August of 2005 "asking us about a fairly broad level of questions on some revenue recognition."

"We're complying with that informal investigation," Rollins said. "That's about all we know. We don't think there are going to be any issues that are material that we're going to have to worry about."

Chief Financial Officer Jim Schneider added that "this has gone on for about a year without anything being alleged. The facts that we're looking at right now in our opinion would not have a material effect on our financial statement."

Second-quarter profit, meanwhile, fell to $502 million from $1.02 billion in the same period a year ago.

Dell, which slashed its second-quarter outlook last month, reported earnings of 22 cents per share on sales of $14.1 billion, which were up 5 percent from a year ago. The company had originally forecast earnings of 32 cents per share on sales of $14.2 billion.

However, the results met the lowered expectations of analysts polled by Thomson Financial. In the same period a year ago, Dell had earnings of 38 cents per a share on sales of $13.4 billion.

Rollins said several factors were to blame, mainly overly aggressive pricing, a slowing marketplace and component prices that weren't lowering as expected.

On Monday, Dell and the Consumer Product Safety Commission announced the agency's largest-ever electronics recall for lithium-ion batteries on notebooks sold between April 1, 2004, and July 18 of this year.

The problem, which has resulted in smoke and fires but no injuries, appears to be with the battery cell maker Sony Corp. and hasn't affected others like main Dell rival Hewlett-Packard Co.

In sharp contrast to Dell, Hewlett-Packard Co. on Wednesday posted third-quarter profit that beat expectations while raising its guidance for the upcoming period.

Dell didn't provide an estimate for the recall's cost but said it won't materially affect the company's financial results, suggesting that Sony will bear the brunt of the cost, which analysts have estimated could run $200 million to $400 million.

All these combined factors overshadowed another Dell announcement: that it had expanded a partnership to use Advanced Micro Devices Inc. computer chips in some servers and desktop PCs.

In its last earnings report in May, Dell said it would start using AMD processors for specialized computer servers used mainly by large businesses. It ended a long-standing exclusive relationship between the computer maker and Intel, AMD's chief rival.

Dell said it will offer Dimension desktop PCs with AMD Athlon processors next month, and several new server models using AMD Opteron chips by the end of the year.

Intel said it was disappointed by the decision, while Marty Seyer, senior vice president of commercial business for Sunnyvale, Calif.-based AMD, called it a "win for Dell, for the industry, and most importantly for Dell customers."

Industry analyst Michael Gartenberg of JupiterResearch said it would be a mistake to underestimate Dell but conceded it faces some big challenges "at a time when it's hard for many in the market to get excited about a thing like the PC."

In a call with analysts, even company founder Michael Dell acknowledged there were problems.

"We're not satisfied with our performance and we will do better," he said.

Screwed is what you would have been if you bought some dell yesterday. They are down $2.30 in the premarket

on the HPQ thread at EOD i mentioned shorting dell after i looked into it. I chickened out would of made some $$$

Not sure alway's paper trade it. that never hurts, good exercise. You have to exercise to be good at what you do.

I still paper trade all the time, test complicated strategies and use them for training others.