My Sad Mistake on Now Soaring Dell
I had dropped the ball for the first time this year in my investment strategy when halving a stake in Dell Technologies two weeks ago. I am eating my heart out right now as the market's response to the company's latest quarterly report sent its shares up nearly 22% in today's pre-market trading. Dell posted its Q4 profit per share at $2.20 this Thursday night, instead of $1.73 on average, according to Wall St poll preliminary estimates. It jumped so high, even though the total sales number was only slightly above consensus projections. In addition, its CEOs talked up still growing demand, especially mentioning - what would you think - surely, the AI factors. "Our strong AI-optimized server momentum continues, with orders increasing nearly 40% sequentially and backlog nearly doubling, exiting our fiscal year at $2.9 billion," the official announcement said. This was enough for the sugar high generated immediately in investors' blood. The AI-servers agenda based on graphics processing units is running the show, and Dell becomes one of the important producers of such servers.
Dell also raised its dividend payment by 20% to $1.78 a share, which made the hype wave even bigger. The client solutions segment which is engaged in PC business showed a 12% decline in YoY sales. This did not stop anybody, as the artificial intelligence arguments are considered now above anything else. Even the PC market reportedly may start to show moderate signs of a recovery after a negative slope since the spring of 2022, when the COVID-stimulated mass purchases for distant work boosted orders for electronics.
There was not enough space on the chart to properly mark the current price, so that it was possible to be made only by hand. The situation would be another good lesson for me. So, holding tech stocks for more lasting periods of time is ultimately the best tactic at the moment. It also turned out that I could not repress my feelings concerning the consequences of my own market decisions sometimes, even though on rare occasions already. You know, live and learn. Onward and upward, my friend, I told myself. Besides, now I am ready to use any opportunity to add to my stake in Dell again, in case some temporary price adjustment may lead the stock to the area between $105 and $110, compared to nearly $120 at the moment.
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