On Feb. 28, computing giant Dell
- Dell shipped out 19% more hardware units this quarter than it did a year earlier. But for various reasons, the average selling price slipped about 8% to land the total revenue improvement at 10.5%.
- One of those reasons is proportionally higher sales in emerging markets like China, Russia, and Brazil, where low margins come with the territory.
- While the GAAP numbers may look bleak, Dell is actually making more cash this year than last, including a much stronger structural cash flow of $833 million in the quarter.
(Figures in millions, except per-share data.)
Income Statement Highlights
Q4 2008 |
Q4 2007 |
Change |
|
---|---|---|---|
Sales |
$15,989 |
$14,470 |
10.5% |
Net Profit |
$679 |
$726 |
(6.5%) |
EPS |
$0.31 |
$0.32 |
(3.1%) |
Diluted Shares |
2,201 |
2,251 |
(2.2%) |
Get back to basics with the income statement.
Margin Checkup
Q4 2008 |
Q4 2007 |
Change* |
|
---|---|---|---|
Gross Margin |
18.8% |
17.1% |
1.7 |
Operating Margin |
4.9% |
5.7% |
(0.8) |
Net Margin |
4.2% |
5.0% |
(0.8) |
Margins are the earnings engine.
Balance Sheet Highlights
Assets |
Q4 2008 |
Q4 2007 |
Change |
---|---|---|---|
Cash + ST Invest. |
$7,972 |
$10,298 |
(22.6%) |
Accounts Rec. |
$5,961 |
$4,622 |
29.0% |
Inventory |
$1,180 |
$660 |
78.8% |
Liabilities |
Q4 2008 |
Q4 2007 |
Change |
---|---|---|---|
Accounts Payable |
$11,492 |
$10,430 |
10.2% |
Long-Term Debt |
$362 |
$569 |
(36.4%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
Q4 2008 |
Q4 2007 |
Change |
|
---|---|---|---|
Cash From Ops. |
$1,197 |
$1,221 |
(2.0%) |
Capital Expenditures |
$195 |
$330 |
(40.9%) |
Free Cash Flow |
$1,002 |
$891 |
12.5% |
Owner Earnings |
$833 |
$525 |
58.7% |
Free cash flow is a Fool's best friend.
Competitive Context
Market Cap |
Trailing P/E Ratio |
CAPS Rating |
|
---|---|---|---|
International Business Machines |
$158,540 |
15.9 |
|
Hewlett-Packard |
$123,190 |
16.1 |
|
Apple |
$112,740 |
28.1 |
|
Dell |
$46,160 |
15.5 |
|
Sun Microsystems |
$15,160 |
20.0 |
Using the latest reported numbers from Capital IQ. Keep your partners close and the competition in your vest pocket.
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