Tuesday, April 5, 2011

Dell (DELL) Sitting it Out Until Late 2012 Says Cowen

Dell (NASDAQ:DELL) computer will be doing little over the next year-in-a-half in the opinion of Cowen & Co. analyst Matthew Hoffman, who sees the company sitting it out until Windows 8 arrives in 2012.

Dell is more than likely to linger on the sidelines Hoffman thinks, until late 2012 when Microsoft’s (NASDAQ:MSFT) Windows 8 is released.

The consequences will be that Dell will maintain a 14 percent share of the global PC market, but that's market that’s growing smaller, meaning Dell’s PC revenue, which is 50 percent of overall sales, will drop 1 percent annually, compounded, in 2012 and 2013.

Concerning the tablet market, which is pressuring Dell, Hoffman said this:

"We are increasing calendar ’11 tablet revenue to $32B (from $31B); cutting calendar ’11 PC units to 356MM (just +1% y/y) from 399MM (+11% y/y); cutting calendar ’11 PC revenue to $237B (+0% y/y) from $255B (+6% y/y); increasing calendar ’12 tablet units to 91MM (+77% y/y) from 82MM (+59% y/y) units; and increasing calendar ’12 tablet revenue to $58B (+81% y/y) from $44B (+42%) previously."

Dell was trading at $14.45, up $0.20, or 1.40 percent, as of 2:47 PM EDT. Hoffman has a "Neutral" rating on the computer company.

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