Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C . The company's strengths can be seen in multiple areas, such as its attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and weak operating cash flow.
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Highlights from the ratings report include:
- DELL INC's earnings per share declined by 26.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DELL INC increased its bottom line by earning $1.89 versus $1.35 in the prior year. This year, the market expects an improvement in earnings ($1.90 versus $1.89).
- DELL, with its decline in revenue, underperformed when compared the industry average of 23.4%. Since the same quarter one year prior, revenues slightly dropped by 4.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Net operating cash flow has significantly decreased to -$138.00 million or 129.67% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Computers & Peripherals industry. The net income has significantly decreased by 32.8% when compared to the same quarter one year ago, falling from $945.00 million to $635.00 million.
Dell Inc. provides integrated technology solutions in the information technology (IT) industry worldwide. The company has a P/E ratio of 7.1, above the average computer hardware industry P/E ratio of 7 and below the S&P 500 P/E ratio of 17.7. Dell has a market cap of $21.51 billion and is part of the
industry. Shares are down 15.7% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.