Dell Stock Plunges Despite Q1 Beat: What To Know
Dell stock is tanking after the PC maker beat Q1 estimates but issued a mixed outlook for its second quarter. Here's what you need to know.
You are now subscribed
Your newsletter sign-up was successful
Want to add more newsletters?
Delivered daily
Kiplinger Today
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more delivered daily. Smart money moves start here.
Sent five days a week
Kiplinger A Step Ahead
Get practical help to make better financial decisions in your everyday life, from spending to savings on top deals.
Delivered daily
Kiplinger Closing Bell
Get today's biggest financial and investing headlines delivered to your inbox every day the U.S. stock market is open.
Sent twice a week
Kiplinger Adviser Intel
Financial pros across the country share best practices and fresh tactics to preserve and grow your wealth.
Delivered weekly
Kiplinger Tax Tips
Trim your federal and state tax bills with practical tax-planning and tax-cutting strategies.
Sent twice a week
Kiplinger Retirement Tips
Your twice-a-week guide to planning and enjoying a financially secure and richly rewarding retirement
Sent bimonthly.
Kiplinger Adviser Angle
Insights for advisers, wealth managers and other financial professionals.
Sent twice a week
Kiplinger Investing Weekly
Your twice-a-week roundup of promising stocks, funds, companies and industries you should consider, ones you should avoid, and why.
Sent weekly for six weeks
Kiplinger Invest for Retirement
Your step-by-step six-part series on how to invest for retirement, from devising a successful strategy to exactly which investments to choose.
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
-
Dow Leads in Mixed Session on Amgen Earnings: Stock Market TodayThe rest of Wall Street struggled as Advanced Micro Devices earnings caused a chip-stock sell-off.
-
How to Watch the 2026 Winter Olympics Without OverpayingHere’s how to stream the 2026 Winter Olympics live, including low-cost viewing options, Peacock access and ways to catch your favorite athletes and events from anywhere.
-
Here’s How to Stream the Super Bowl for LessWe'll show you the least expensive ways to stream football's biggest event.
-
Dow Leads in Mixed Session on Amgen Earnings: Stock Market Today
The rest of Wall Street struggled as Advanced Micro Devices earnings caused a chip-stock sell-off.
-
How to Add a Pet Trust to Your Estate Plan: Don't Leave Your Best Friend to ChanceAdding a pet trust to your estate plan can ensure your pets are properly looked after when you're no longer able to care for them. This is how to go about it.
-
Want to Avoid Leaving Chaos in Your Wake? Don't Leave Behind an Outdated Estate PlanAn outdated or incomplete estate plan could cause confusion for those handling your affairs at a difficult time. This guide highlights what to update and when.
-
I'm a Financial Adviser: This Is Why I Became an Advocate for Fee-Only Financial AdviceCan financial advisers who earn commissions on product sales give clients the best advice? For one professional, changing track was the clear choice.
-
Nasdaq Slides 1.4% on Big Tech Questions: Stock Market TodayPalantir Technologies proves at least one publicly traded company can spend a lot of money on AI and make a lot of money on AI.
-
I Met With 100-Plus Advisers to Develop This Road Map for Adopting AIFor financial advisers eager to embrace AI but unsure where to start, this road map will help you integrate the right tools and safeguards into your work.
-
The Referral Revolution: How to Grow Your Business With TrustYou can attract ideal clients by focusing on value and leveraging your current relationships to create a referral-based practice.
-
This Is How You Can Land a Job You'll Love"Work How You Are Wired" leads job seekers on a journey of self-discovery that could help them snag the job of their dreams.
