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Analyst Research Report Snapshot


Dell - Overview of Q4 2013 Results




Indigo Equity Research


21 Feb 2013





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Overview of 2013 Q4 Results - Another disaster Revenues & margins fell in all products, regions & client groups; except for servers. PC's continue to deteriorate with pricing pressure, and a weak macro environment. Dell has changed strategy and started to sacrifice margin to maintain market share. Excluding $250 m received for vendor settlements and recent big acquisitions; the underlying results were even worse. Windows 8 failed to boost PC sales. The critical valuation issue is the pending $13.65 offer to take the company private. As this is a buy-out, it is unlikely that the offer price will be raised much or another bidder will appear. If the offer falls apart, the share price will probably fall below $10 due to Dell's weak fundamentals. Thus, there is mostly downside risk at present. - Q4 Total Revenue fell $1.7 bn (-11%) to $14.3 bn. Investment thesis - Dell's turnaround strategy is fundamentally flawed. ….. …. In summary, despite the cheap valuation it's better to wait for evidence of a turnaround. This 10 page report includes: results analysis, investment thesis, recent key events, SWOT analysis …. Independent, buy-side, fundamental, financial analysis. www.indigo-equity-research.com

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