Skip to Content
Stock Analyst Update

Dell's Growing Pains Far from the End of the World

PC maker still has opportunities despite slowing growth.


As many feared, Dell's (DELL) revenue growth was a bit weaker than Wall Street expectations in its July-ending quarter, even though the company beat consensus earnings estimates by a penny Thursday. Yet it still appears that the firm has the ability to continue outperforming many of its peers in the computer-hardware industry in both growth and returns on capital. Thus, if its shares continue to decline, it may be a good time for investors to take a closer look at Dell.

On the whole, Dell's fiscal second-quarter results were solid, but not exceptional. Revenue growth clocked in at 25% compared with the prior-year period, which is high compared with the rate at which the PC industry is growing, but slower than management's 30% growth goal set in the beginning of the year. But including first-quarter results, Dell is actually fairly close to being on track for 30% growth this year.

Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.