World personal computer king Dell (NASDAQ:DELL) has been described as having scary efficiency. The stock has produced, since 1988, a 39,900% return. Last night the company reported another fantastic quarter, and the stock is up 6% in mid-morning trading. Are there tender morsels to savor in this delicious earnings report?

Revenue increased 16% compared with last year's first quarter, helped significantly by a 21% increase in sales outside the U.S. (which are now 42% of total sales). Net income shot up 28% to $934 million, and earnings per share increased 32% to $0.29. Since these results met analyst expectations, there is little to get excited about here.

Computer industry analyst Gartner Group (NYSE:IT) expected the 2005 PC market demand to grow 10%, fueled by businesses replacing their aging units. Dell's first-quarter desktop PC sales (40% of total sales) were up 6%; notebook sales (24% of sales) surged 22%. That's solid growth, and ahead of expectations for industry PC growth -- the company registered 11.6% growth (desktop and notebooks combined) over the same period last year.

How strong is Dell's PC business? Dell continues to build its PCs in the U.S. -- and grow. IBM (NYSE:IBM), which built its PCs outside the U.S., found the business too competitive and sold its operations to China's Lenovo. Gateway (NYSE:GTW) bought eMachines in a bid to increase overall profitability and gain market share -- but still lost money in its latest quarter.

In Hewlett-Packard's (NYSE:HPQ) latest quarter, printing and imaging was 28.3% of total sales but a disproportionate 67.3% of total profits. In Dell's latest quarter, sales of high-margin printer ink, toner, and supplies nearly doubled, and total worldwide software and peripheral sales (which includes imaging and printing, TVs, and displays) increased 29% from the year-ago quarter. At 15% of total sales (up from 13% a year ago), it would seem there is plenty of room for growth in this high-margin business.

Recording a 30% increase in revenue over the year-ago quarter was Dell's Enhanced Services operation. Gartner Group recently ranked Dell No. 1 in hardware service revenue in the U.S. and No. 4 worldwide. This business has grown to 8% of quarter sales -- up 1% (almost 7% of sales for Q1 2004, 8% of sales for Q1 2005) from the year-ago quarter.

Here are two more savory morsels comparing this quarter with the one a year ago. Operating margins increased 0.4% to 8.8%. Even better, cash and short-term investments increased from $5.3 billion (at the same time last year) to $9.8 billion.

Dell is a golden goose. With only $504 million in debt and a booming business, you would expect the stock to be strong, right? Guess again. This Motley Fool Stock Advisor recommendation has seen its stock rise about 6% over the last 52 weeks.

But long-term investors will notice that analysts expect earnings to rise 24% this year and 17.5% next year -- pricing the stock at 20.7 times 2006 earnings. That's a very reasonable price for a company that has proved, over the long term, that it can enter markets and profitably dominate them.

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Fool contributor W.D. Crotty does not own shares in any of the companies mentioned -- although a Dell computer was used to create this analysis. Click here to see The Motley Fool's disclosure policy.