Dell stock rises as computer maker smashes first-quarter estimates

Computer hardware giant Dell Technologies (DELL) smashed Wall Street estimates for its first fiscal quarter on Thursday. Dell stock rose on the news.


The Round Rock, Texas-based company earned an adjusted $1.31 per share on sales of $20.92 billion in the quarter ended May 5. Meanwhile, analysts polled by FactSet had expected Dell to earn 86 cents a share on sales of $20.27 billion. However, on a yearly basis, Dell’s revenue fell 29% while sales fell 20%.

“We performed well in a difficult economic environment,” Chuck Whitten, Dell’s co-chief operating officer, said in a press release. “We maintained pricing discipline, reduced operating expenses and our supply chain continued to perform well after normalizing ahead of our competitors.”

Dell’s Infrastructure Solutions Group reported revenue of $7.6 billion, down 18%. The unit sells servers, storage and networking hardware. Additionally, the company’s Client Solutions group reported sales of $12 billion, down 23%. The division sells desktop computers and laptops.

Dell stock rises after first report

Better-than-expected commercial PC sales and improving profit margins fueled Dell’s first-quarter pace, Evercore ISI analyst Amit Daryanani said in a note to clients. He believes Dell stock is outperforming with a price target of 55.

Dell surprised Wall Street by releasing its earnings report an hour before market close. In trading today, Dell stock rose 1.5% to 45.47.

Dell stock is on the IBD Technology Leaders list. Additionally, it has an IBD composite rating of 86 out of 99, according to IBD Stock Checkup.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.


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