Dell Technologies (DELL) is not expected to rebound significantly this week after reporting earnings that fell short of expectations. Here's a detailed analysis:
- Earnings Miss: Dell reported a Basic EPS of $1.63 for the quarter ending December 31, 2024, which was below the consensus EPS forecast of $1.051. This miss on earnings expectations could lead to a negative sentiment among investors.
- Revenue Beat: Despite missing on earnings, Dell's reported revenue of $20.92 billion for the quarter was above analysts' expectations2. This could be seen as a positive sign, but it may not be enough to offset the disappointment from the lower-than-expected earnings.
- Analyst Ratings: The average price target from analysts is $130.08, which represents a significant downside from the last price of $148.753. This suggests that analysts do not see a strong rebound in the near term.
- Stock Reaction: Dell's stock experienced a significant decline, tumbling over 17% in extended trading despite revenue and earnings that beat analysts' estimates4. This reaction indicates that the market may have been more focused on the lower-than-expected earnings than the revenue beat.
- Future Outlook: The company's forecast for the current quarter shows adjusted earnings of $1.65 per share on sales of $24 billion, which is below the analyst expectations of $1.885. This further reinforces the notion that Dell may not see a strong rebound in the immediate future.
- Technical Indicators: The stock's technical indicators show a bearish trend, with a 14-day Relative Strength Index (RSI) of 58.57, which is neither overbought nor oversold6. This suggests that the stock may not be primed for a strong rebound in the short term.
In conclusion, while Dell reported revenue above expectations, the miss on earnings and the subsequent negative market reaction suggest that the stock may not see a significant rebound this week. The analyst price targets and the stock's technical indicators support this view.
6/3/2024 03:46am
