“Dude, you got Dell stock? Well, poor you,” Jay Palmer writes for Barron’s. “Since mid-July, shares of Round Rock, Texas-based Dell Computer have tumbled 28%, from just under 42 to 29.76, the lowest level in roughly two-and-a-half years. Over the same period, long-scorned rival Hewlett-Packard has risen nearly 15% to 28.53 from 24.73. So what’s going on?”

“Well, last week’s news certainly has one wondering. Ahead of its third quarter results due out this Thursday, Dell issued a stark warning that its three-month revenues will be only 2% higher at $13.9 billion, well below its original guidance of $14.1 to $14.5 billion. Earnings (before a $450 million, or 14-cents-a-share one-time charge, mainly for replacing faulty parts) will be around 39 cents a share, up 18% from a year earlier but still at the very low end of recent projections,” Palmer writes.

“A single-quarter miss could be forgiven. But Dell’s revenue growth has now slowed for seven quarters in a row and, worse, this will be the fourth consecutive quarter that Dell has missed the market’s estimates. Not surprisingly, last week saw downgrades by analysts at several top firms, many of them questioning whether Dell can ever hit the ambitious 2008 sales target of $80 billion set last April, up from perhaps $56 billion this year,” Palmer writes. “‘Has Dell lost its mojo?’ asks Cindy Shaw at Moors & Cabot. ‘I think so, and that’s why I am downgrading the stock.’ At the stock’s current price, there are still more than a few die-hard fans. They argue that if there was ever a company capable of masterminding a return to growth, it’s Dell . That’s probably true, but it’s no longer enough. If Dell’s revenue fails to grow faster, and certainly if the company continues to miss earnings targets, it will be time to admit that Dell is past its best.”

Full article here.

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MacDailyNews Take: Why not just shut the company down and give the money back to shareholders, Mr. Dell?

In the last reported quarter, Apple boosted growth in total Mac shipments by 48%. Dell’s unit sales increased 17.6% in the same period according to Gartner Inc. Apple’s market cap is currently $50,387,216,880. Dell’s is currently $70,796,255,550.

“We’re coming after you, you’re in our sights.” – Apple CEO Steve Jobs speaking about Dell, November 10, 1997. (source)

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