3 Dell Technologies Analysts Offer Different Takes On Mixed Results

Zinger Key Points
  • Dell witnessed deteriorating demand in both PCs and enterprise infrastructure, said one analyst.
  • Customers are becoming more cautious in the quarter.

Dell Technologies Inc DELL reported on Thursday mixed results for its second quarter, with an earnings beat but revenue short of Wall Street expectations.

Morgan Stanley On Dell Technologies

Analyst Erik Woodring reaffirmed an Equal-Weight rating while reducing the price target from $56 to $54.

Dell witnessed deteriorating demand in both PCs and enterprise infrastructure, with “customers becoming more cautious in the quarter,” Woodring said in a note. “DELL highlighted that its deal pipeline didn't build as expected during the July quarter as large companies pushed and/or downsized deals due to greater macro uncertainty,” he added.

Free cash flows will likely remain under pressure due to moderating demand in the back half of the year, the analyst stated.

Check out other analyst stock ratings.

Credit Suisse On Dell Technologies

Analyst Shannon Cross reiterated an Outperform rating and a price target of $60.

“Dell Technologies reported F2Q23 results that missed us on the topline owing to Consumer PCs but beat on the bottom line as mix-shift to commercial revenue provided an offset,” Cross wrote in a note.

The stock’s low multiple shows that investors were already expecting “a significant deterioration in PC revenue,” she added.

“Although FCF will be under pressure this year given PC weakness, we still expect ~$3.8 billion in FCF with update potential from working capital and see no change to capital return programs,” the analyst further mentioned.

Raymond James On Dell Technologies

Analyst Simon Leopold maintained an Outperform rating while reducing the price target from $54 to $51.

“Although PC weakness was anticipated, the downtick was worse than expected,” Leopold said. “ISG continues to grow, but management cited slower demand and macro concerns that sounded worse than other IT equipment supplier commentary,” he added.

DELL Price Action: Shares of Dell Technologies are down 12.28% to $42.02 at the time of publication Friday.

Photo: JPstock via Shutterstock

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Posted In: Analyst ColorEarningsNewsPrice TargetReiterationAnalyst RatingsMoversTechTrading IdeasCredit SuisseErik WoodringMorgan StanleyPCsShannon Cross
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