DELL - Embedded Expectations Analysis - 2021 01 21
Dell Technologies Inc. (DELL:USA) currently trades well below corporate averages relative to UAFRS-based (Uniform) earnings, with a 9.4x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may have concerns about their market share, revenue growth, and operating expensesSpecifically, management may lack confidence in their ability to strengthen their FedEx and Switch relationships, sustain conversion rates for small and medium businesses, and accelerate the PowerStore ramp-up. In addition, they may have concerns about their strategic decision to move from retail to direct and online selling, market share losses in their consumer PC business, and continued demand softness for their Infrastructure Solutions Group (ISG). Furthermore, they may lack confidence in their ability to contain their operating expenses and sustain profitability growth. Finally, management may be overstating the potential of their hybrid cloud business, and they may be concerned about leverage and enterprise business growth opportunities
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.
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