Morningstar | Dell Technologies Sees Growth in Hybrid Clouds
Born out of Dell's 2016 acquisition of EMC, Dell Technologies is a pre-eminent vendor of IT infrastructure products and services. Although Dell Technologies has substantial exposure to commoditized markets and carries considerable financial leverage, we believe synergistic opportunities across its brands should drive success as businesses migrate to hybrid cloud IT infrastructures.Dell Technologies' business centers around PCs and peripherals, servers, storage, networking equipment, as well as software, services, and financial services. Its brands include Dell, Dell EMC, VMware, Boomi, Pivotal, RSA Security, Secureworks, and Virtustream. The company returned to the public market in late 2018 through a reverse merger of the VMware tracking stock, DVMT.Dell Technologies’ largest revenue streams of commercial PCs and servers are in cutthroat pricing environments that rely on services and support to generate profit. We expect the overall PC market to continue consolidating toward an oligopoly and for consumer-based profits to come from high-end and gaming PC sales. While storage is a challenging marketplace, we believe flash-based arrays and hyperconverged infrastructure provide avenues for rampant growth. We posit that the company's majority ownership of VMware and other cloud-centric software brands provides growth catalysts as firms augment hardware with software-based solutions.After the acquisition of EMC, we view Dell Technologies as an end-to-end IT infrastructure provider that is supplementing hardware prowess with emerging software and cloud-based solutions. We're optimistic about its ability to upsell VMware and other cloud-based solutions, especially in high-growth areas of hyperconverged infrastructure and software-defined networking, but we do expect competitive markets to challenge the company's overall profitability.We think that Dell Technologies' debt burden may affect its ability to invest in the development and sales of future innovative products. Public shareholders have very little influence on the company's strategy and rely heavily on CEO Michael Dell and Silver Lake Partners making value-accretive decisions.Dell Technologies is a holding company. Through its subsidiaries, the company designs, develops, manufactures, markets, sells, and supports a range of products and services. The company's reportable segments are: Infrastructure Solutions Group, which includes servers, networking, and storage, as well as services and third-party software and peripherals; Client Solutions Group, which includes desktops, thin client products, and notebooks, as well as services and third-party software and peripherals; and VMware, which provides compute, cloud management, networking and security, storage and availability, and other end-user computing offerings.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.