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What's in the Cards for Dell Technologies (DELL) Q4 Earnings?

Zacks Equity Research
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Dell Technologies DELL is set to release fourth-quarter fiscal 2019 results on Feb 28.

This will be the first quarterly earnings of the company after it returned back to public market in December, last year.

The Zacks Consensus Estimate for earnings has remained steady at $1.89 over the past seven days. The consensus mark for revenues is $23.46 billion and is expected to grow roughly 7% year over year.

Let’s see how things are shaping up for this announcement.

Factors to Watch

Dell is expected to benefit from its dominant position in the enterprise IT solutions market. Strong spending by customers on infrastructure is expected to be key catalyst for the company in the to-be-reported quarter.

The company is also likely to gain from the ongoing momentum at VMware VMW, in which it has a majority stake. Dell also own stakes in Pivotal Software PVTL and SecureWorks.

However, a sluggish PC market doesn’t bode well for the company. Additionally, the company faces stiff competition in the server and data storage equipment market, not only from the likes of HP and Hewlett Packard Enterprise (in on-premise hardware) but also from cloud computing service providers like Amazon, Microsoft and Google.

Moreover, Dell’s leveraged balance sheet is a headwind.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a good chance of beating estimates. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided.

Dell has a Zacks Rank #2 and an Earnings ESP of -1.33%. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

A Stock With Favorable Combination

Here is a stock you may want to consider as our model shows that it has the right combination of elements to post an earnings beat.

Momo Inc. MOMO has an Earnings ESP of +1.55% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

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Momo Inc. (MOMO) : Free Stock Analysis Report
 
Dell Technologies Inc. (DELL) : Free Stock Analysis Report
 
VMware, Inc. (VMW) : Free Stock Analysis Report
 
Pivotal Software, Inc. (PVTL) : Free Stock Analysis Report
 
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