Updated from May 15

Shares of Dell ( DELL) slid a day after the hardware maker failed to offer any upside in sales guidance for the second quarter. For a serial overachiever, it seems meeting Wall Street's expectations isn't enough -- investors want Dell to beat them.

The stock was off 74 cents, or 2.3%, to $31.44 in midmorning trading.

"Given the recent run-up in the shares and the minimal upside to the quarter, it would not surprise us if the stock came under some pressure," says Lehman's Dan Niles in a morning note. Dell shares have shot up 41% from their year-to-date low in February. Lehman does no banking for Dell.

Niles, who has an equal weight rating on the shares, says he's a little unsettled by Dell's valuation of more than 30 times calendar '03 earnings, given what he calls "the backdrop of continued sluggish IT demand."

In that vein, Niles was surprised by Dell's forecast for a sequential contraction of 6% in second-quarter computer shipments; he's been forecasting a decline of only 3%. Yesterday, Dell CFO Jim Schneider said the information technology spending environment appears to have stabilized, but didn't offer any fodder for those hoping for a near-term recovery.

At Merrill Lynch, Steve Milunovich likewise said he was staying neutral on Dell shares given their valuation. "We certainly consider Dell a core holding but would not chase it here," he said in a note. But on a fundamental note, he added, there's not much to worry about.

"We agree with Michael Dell that there is lots of share to be gained. Dell's PC share of 17% could go to 30%. Its enterprising computing share should rise." Even services will likely commoditize over time, thus playing to Dell's strengths, notes Milunovich. Merrill doesn't do any banking for Dell.