Dell Technologies (DELL) stock is trading down more than 20% Friday after the PC maker's appearance on the earnings calendar. While Dell exceeded top- and bottom-line expectations for its fiscal first quarter, it issued mixed guidance for its second quarter.
In the three months ended May 3, Dell's revenue increased 6% year-over-year to $22.2 billion, driven by a 42.4% jump in servers and networking revenue. The company said earnings per share (EPS) decreased 3% from the year-ago period to $1.27.
"We again demonstrated our ability to execute and deliver strong cash flow, with artificial intelligence (AI) continuing to drive new growth," Yvonne McGill, chief financial officer at Dell, said in a statement, adding that the company "generated $7.9 billion of cash flow from operations over the last 12 months."
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results beat analysts' expectations. According to CNBC, Wall Street was anticipating revenue of $21.6 billion billion and earnings of $1.26 per share.
For its fiscal second quarter, Dell anticipates earnings of $1.65 per share and revenue in the range of $23.5 billion to $24.5 billion, the company said on its conference call.
However, the Q2 outlook came in mixed compared with analysts' expectations. According to Yahoo Finance, Wall Street is expecting revenue of $23.3 billion and earnings of $1.82 per share.
"No company is better positioned than Dell to bring AI to the enterprise," said Jeff Clarke, chief operating officer of Dell, in a statement.
Is Dell stock a buy, sell or hold?
The tech stock has posted an incredible performance so far in 2024, rising more than 70% for the year to date as of this writing, even when factoring in today's selloff.
Overall, analysts remain upbeat on Dell. According to S&P Global Market Intelligence, the consensus analyst target price for the AI stock is $153.01, representing implied upside of 14% to current levels. Meanwhile, the consensus recommendation is a Buy.
UBS Global Research is one of the more bullish outfits on Dell stock following the earnings release, with analyst David Vogt maintaining a Buy rating and raising his price target to $164 from $141.
The price-target hike is "driven by stronger and more durable revenue and profit growth than previously expected," Vogt wrote in a May 31 report. "While share price upside potential is more modest over the next 12 months relative to the past 12 months, we still view Dell as a secular winner in AI servers over the next several years."
UBS' new $164 price target represents implied upside of about 22% to current levels.
Related Content
-
Stocks Slip to Start Fed Week: Stock Market TodayWhile a rate cut is widely expected this week, uncertainty is building around the Fed's future plans for monetary policy.
-
December Fed Meeting: Live Updates and CommentaryThe December Fed meeting is one of the last key economic events of 2025, with Wall Street closely watching what Chair Powell & Co. will do about interest rates.
-
This Is Why Investors Shouldn't Romanticize BitcoinInvestors should treat bitcoin as the high-risk asset it is. A look at the data indicates a small portfolio allocation for most investors would be the safest.
-
Stocks Slip to Start Fed Week: Stock Market Today
While a rate cut is widely expected this week, uncertainty is building around the Fed's future plans for monetary policy.
-
December Fed Meeting: Live Updates and Commentary
The December Fed meeting is one of the last key economic events of 2025, with Wall Street closely watching what Chair Powell & Co. will do about interest rates.
-
Why Investors Shouldn't Romanticize Bitcoin, From a Financial Planner
Investors should treat bitcoin as the high-risk asset it is. A look at the data indicates a small portfolio allocation for most investors would be the safest.
-
I'm a Financial Pro Focused on Federal Benefits: These Are the 2 Questions I Answer a LotMany federal employees ask about rolling a TSP into an IRA and parsing options for survivor benefits, both especially critical topics.
-
Private Credit Can Be a Resilient Income Strategy for a Volatile Market: A Guide for Financial AdvisersAdvisers are increasingly turning to private credit such as asset-based and real estate lending for elevated yields and protection backed by tangible assets.
-
5 RMD Mistakes That Could Cost You Big-Time: Even Seasoned Retirees Slip UpThe five biggest RMD mistakes retirees make show that tax-smart retirement planning should start well before you hit the age your first RMD is due.
-
I'm a Wealth Adviser: My 4 Guiding Principles Could Help You Plan for Retirement Whether You Have $10,000 or $10 MillionRegardless of your net worth, you deserve a detailed retirement plan backed by a solid understanding of your finances.
-
A Retirement Triple Play: These 3 Tax Breaks Could Lower Your 2026 BillGood news for older taxpayers: Standard deductions are higher, there's a temporary 'bonus deduction' for older folks, and income thresholds have been raised.
