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Dell Technologies (DELL)
:DELL
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Dell Technologies
(NYSE:DELL)66Neutral
Positive Factors
AI server growth
Dell's server and networking segment revenue is expected to increase significantly, driven by increasing AI server demand.
Share repurchase authorization
Dell announced a new $10bn share repurchase authorization and raised their dividend by 18%.
Negative Factors
Tariff impact
If tariffs go into effect, Dell will likely pass the incremental costs to customers, which could drive some demand destruction.
Dell Technologies (DELL) vs. S&P 500 (SPY)
Market Cap
$66.01B
Dividend Yield1.86%
Average Volume (3M)9.56M
Price to Earnings (P/E)14.7
Beta (1Y)1.84
Revenue Growth7.99%
EPS GrowthN/A
CountryUS
Employees120,000
SectorTechnology
Sector Strength48
IndustryHardware & Equipment
Share Statistics
EPS (TTM)6.22
Shares Outstanding358,574,300
10 Day Avg. Volume10,226,912
30 Day Avg. Volume9,564,992
Financial Highlights & Ratios
PEG Ratio0.37
Price to Book (P/B)N/A
Price to Sales (P/S)0.71
Price to Cash Flow (P/CF)10.80
P/FCF Ratio18.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$137.36Price Target Upside46.02% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering15
Dell Technologies Business Overview & Revenue Model
Company DescriptionDell Technologies Inc. is a multinational information technology company which is engaged in providing hardware and software services solutions. The comapny, through its Client Solutions Group (CSG), sells desktops, notebooks, workstations, third-party software and peripherals. Meanwhile, it offers storage, networking and servers as well as attached software and peripherals through its Infrastructure Solutions Group (ISG). Under the VMware division, the company provides cloud management, compute, storage and availability, networking and security, and other end-user computing solutions.
How the Company Makes MoneyDell Technologies generates revenue through multiple streams, primarily from the sale of its hardware products like laptops, desktops, and servers. The company also earns significant income from its infrastructure solutions group, which provides enterprise-grade storage, networking, and virtualization solutions. Additionally, Dell Technologies offers software and services, including IT consulting and support, cloud services, and cybersecurity solutions. The company's earnings are further bolstered by its strategic partnerships and collaborations with other tech firms, enhancing its service offerings and expanding market reach. Key factors contributing to Dell's revenue include its extensive distribution network, diverse product portfolio, and a strong focus on innovation and customer service.
Dell Technologies Financial Statement Overview
Summary
Dell Technologies presents a mixed financial picture. The income statement reflects strong profitability and revenue growth, although at a slowing pace. The balance sheet indicates high leverage with negative equity, presenting financial risks. Cash flows are robust, yet declining free cash flow growth suggests caution. Overall, while operational performance is commendable, the financial structure poses potential challenges.Income Statement
Dell Technologies' income statement shows a solid performance with a gross profit margin of 22.08% and a net profit margin of 4.35% for TTM (Trailing-Twelve-Months). Revenue growth from the previous annual report is 6.25%, indicating a positive trajectory. EBIT and EBITDA margins stand at 6.03% and 5.90% respectively, showcasing stable operational efficiency. However, the growth rate has slowed compared to previous years, which may be a point of concern.75
Positive
Balance Sheet
The balance sheet reveals a negative stockholders' equity, which is concerning as it implies liabilities exceed assets. The debt-to-equity ratio cannot be calculated due to negative equity, indicating high leverage. The equity ratio is also negative, further highlighting financial instability. These factors pose risks despite the company’s operational profitability.60
Neutral
Cash Flow
Dell's cash flow statement shows a healthy operating cash flow to net income ratio of 1.34 and a free cash flow to net income ratio of 0.69, indicating strong cash generation relative to net income. The free cash flow growth rate is negative, decreasing by 52.28% from the previous year, which may affect future liquidity.70
Positive
| Breakdown | |||||
| TTM | Jan 2024 | Apr 2023 | Jan 2023 | Jan 2022 | Jan 2021 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 93.95B | ― | ― | ― | ― | ― | Gross Profit |
| 20.74B | 20.87B | 5.02B | 22.69B | 21.89B | 76.57B | EBIT |
| 5.67B | 5.21B | 1.07B | 5.77B | 4.66B | 3.69B | EBITDA |
| 5.54B | 8.69B | 1.11B | 7.60B | 12.02B | 9.79B | Net Income Common Stockholders |
| 4.09B | 3.21B | 583.00M | 2.44B | 5.56B | 3.25B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| ― | ― | ― | ― | ― | ― | Total Assets |
| 82.09B | 82.09B | 84.09B | 89.61B | 92.73B | 123.42B | Total Debt |
| 25.99B | 25.99B | 28.43B | 29.59B | 26.95B | 39.22B | Net Debt |
| 18.63B | 18.63B | 20.80B | 20.98B | 17.48B | 29.71B | Total Liabilities |
| 84.40B | 84.40B | 87.02B | 92.64B | 94.31B | 120.94B | Stockholders Equity |
| ― | ― | ― | ― | ― | ― |
| Cash Flow | Free Cash Flow | ||||
| 2.83B | 5.92B | 1.08B | 562.00M | 7.51B | 9.32B | Operating Cash Flow |
| 5.47B | 8.68B | 1.78B | 3.56B | 10.31B | 11.41B | Investing Cash Flow |
| -2.21B | ― | ― | ― | ― | ― | Financing Cash Flow |
| -6.24B | ― | ― | ― | ― | ― |
Dell Technologies Technical Analysis
Negative
94.07
Price Trends
111.42
Negative
119.46
Negative
121.67
Negative
Market Momentum
-2.62
Positive
32.63
Neutral
8.57
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DELL, the sentiment is Negative. The current price of 94.07 is below the 20-day moving average (MA) of 109.96, below the 50-day MA of 111.42, and below the 200-day MA of 121.67, indicating a bearish trend. The MACD of -2.62 indicates Positive momentum. The RSI at 32.63 is Neutral, neither overbought nor oversold. The STOCH value of 8.57 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DELL.
Dell Technologies Risk Analysis
Dell Technologies disclosed 38 risk factors in its most recent earnings report. Dell Technologies reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Dell Technologies Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $2.89T | 31.30 | 30.64% | 0.80% | 15.04% | 12.38% | |
76 Outperform | $3.54T | 37.51 | 144.03% | 0.53% | 2.61% | -2.14% | |
72 Outperform | $24.74B | 9.86 | 10.29% | 2.73% | 3.30% | 25.00% | |
67 Neutral | $234.79B | 39.40 | 22.06% | 2.65% | 1.45% | -20.56% | |
66 Neutral | $66.01B | 14.74 | -179.12% | 1.86% | 7.99% | ― | |
61 Neutral | $29.11B | 11.09 | 84.33% | 3.71% | 1.03% | -18.56% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% |
* Technology Sector Average
Performance Comparison
DELL
Dell Technologies
94.07
-21.94
-18.91%
AAPL
Apple
235.93
66.61
39.34%
HPQ
HP
29.29
1.11
3.94%
IBM
International Business Machines
253.21
67.51
36.35%
MSFT
Microsoft
388.61
-10.99
-2.75%
HPE
Hewlett Packard Enterprise
18.84
1.22
6.92%
Dell Technologies Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -12.76% | Next Earnings Date: May 29, 2025
Earnings Call Sentiment Positive
Dell Technologies showed strong financial performance in FY '25, with significant growth in revenue and EPS. The AI business and ISG are major growth drivers, and the company is optimistic about its FY '26 outlook, expecting substantial growth in AI server shipments. However, challenges persist in the consumer market, and there is a competitive pricing environment that could impact margins.Highlights
Strong Fiscal Year 2025 Performance
Dell Technologies reported FY '25 revenue of $95.6 billion, up 8%, and operating income of $8.5 billion. Record EPS was at $8.14, up 10%, with a cash flow of $4.5 billion.
AI Business Growth
Dell's AI business grew to $10 billion. AI orders demand was $1.7 billion in Q4 with $2.1 billion in shipments, and an AI backlog of roughly $9 billion.
Infrastructure Solutions Group (ISG) Growth
ISG revenue was $11.4 billion, up 22%. Servers and networking revenue hit a Q4 record at $6.6 billion, up 37%.
Dividend and Share Repurchase Program
Dell announced an 18% increase in their annual dividend to $2.10 per share and a $10 billion increase in share repurchase authorization.
Guidance for FY '26
Dell expects FY '26 revenue between $101 billion and $105 billion, with ISG to grow in high teens and CSG to grow low to mid-single digits. AI server shipments are projected to hit $15 billion.
Lowlights
Consumer Market Challenges
Consumer revenue was down 12% to $1.9 billion in Q4, with the demand environment remaining soft and profitability challenged.
Competitive Pricing Environment Impact
Gross margin was down 50 basis points due to a competitive pricing environment, particularly affecting CSG.
Tariff and Regulatory Uncertainty
The transcript highlighted concerns regarding potential impacts from tariffs and dynamic trade regulations, which could affect pricing and supply chain.
Company Guidance
During Dell Technologies' fiscal year 2025 fourth-quarter earnings call, the company provided guidance for FY '26, anticipating revenue between $101 billion and $105 billion, with a midpoint growth of 8%. Dell expects its Infrastructure Solutions Group (ISG) to grow in the high teens, driven by at least $15 billion in AI server shipments. Meanwhile, the Client Solutions Group (CSG) is projected to grow low to mid-single digits, more weighted towards the second half of the year. Despite an anticipated decline in the gross margin rate by approximately 100 basis points due to a higher mix of AI-optimized servers, operating expenses are expected to decrease by low single digits year-over-year. Dell forecasts diluted non-GAAP EPS to increase by 14% to $9.30, plus or minus $0.25, with FY '26 Q1 revenue expected to be between $22.5 billion and $23.5 billion, representing a 3% increase at the midpoint.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.