Yahoo Finance Should You Investigate Dell Technologies Inc. (NYSE:DELL) At US$143?
Today we're going to take a look at the well-established Dell Technologies Inc. (NYSE:DELL). The company's stock received a lot of attention from a substantial price increase on the NYSE over the last few months. While good news for shareholders, the company has traded much higher in the past year. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Today we will analyse the most recent data on Dell Technologies’s outlook and valuation to see if the opportunity still exists.
See our latest analysis for Dell Technologies
What's The Opportunity In Dell Technologies?
The stock seems fairly valued at the moment according to our valuation model. It’s trading around 2.3% below our intrinsic value, which means if you buy Dell Technologies today, you’d be paying a fair price for it. And if you believe the company’s true value is $146.92, then there’s not much of an upside to gain from mispricing. In addition to this, Dell Technologies has a low beta, which suggests its share price is less volatile than the wider market.
What kind of growth will Dell Technologies generate?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Dell Technologies' earnings over the next few years are expected to increase by 55%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? It seems like the market has already priced in DELL’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on DELL, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
So while earnings quality is important, it's equally important to consider the risks facing Dell Technologies at this point in time. You'd be interested to know, that we found 3 warning signs for Dell Technologies and you'll want to know about these.
If you are no longer interested in Dell Technologies, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
