Dell Meets on the Top Line, Misses Where It Counts

Before you go, we thought you'd like these...
Before you go close icon

Dell (NAS: DELL) reported earnings on Feb. 21. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 3 (Q4), Dell met expectations on revenues and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue grew slightly and GAAP earnings per share shrank.

Gross margins improved, operating margins dropped, net margins dropped.

Revenue details
Dell booked revenue of $16.03 billion. The 30 analysts polled by S&P Capital IQ looked for net sales of $15.98 billion on the same basis. GAAP reported sales were 2.2% higher than the prior-year quarter's $15.69 billion.

anImage

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.51. The 33 earnings estimates compiled by S&P Capital IQ anticipated $0.52 per share on the same basis. GAAP EPS of $0.43 for Q4 were 10% lower than the prior-year quarter's $0.48 per share.

anImage

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 21.1%, 10 basis points better than the prior-year quarter. Operating margin was 5.8%, 100 basis points worse than the prior-year quarter. Net margin was 4.8%, 110 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $15.10 billion. On the bottom line, the average EPS estimate is $0.47.

Next year's average estimate for revenue is $62.81 billion. The average EPS estimate is $2.06.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 4,034 members out of 5,682 rating the stock outperform, and 1,650 members rating it underperform. Among 1,259 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 920 give Dell a green thumbs-up, and 339 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Dell is outperform, with an average price target of $17.81.

Looking to profit from the makers of computer hardware? You may be missing something obvious about where the money will be made in the tech industry of the future. Is Dell on the right side of the revolution? Check out the changing landscape and meet the company that Motley Fool analysts expect to lead "The Next Trillion-dollar Revolution." Click here for instant access to this free report.

At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended writing covered calls in Dell. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners