Dell Restructures (Again!)

  • Posted: 31 December 2008 10:22 AM

    Dell is restructuring (again).

    So much for the “return” of Michael Dell and the presumptive (and obviously premature) congratulatory claims of a turnaround we’ve heard over the past couple of years.

    While the company continues to go dumpster diving into the trash heap of the global cheap PC market, shareholders are left holding the bag with a decidedly negative return on assets used to repurchase shares over the past several years in a futile attempt to prop up reported EPS.

    While EPS is one measure of performance, in this market and economy the strength of the company’s balance sheet might be far more important.

    I don’t understand Dell’s approach to increasing shareholder value nor the apparent debasing of the brand name in an effort to push volume.

    I don’t wish to write baseless speculation and I have no firm data to support my suspicions, but I’m wondering if these executive changes timed to coincide with the start of a new fiscal year having anything to do the level of channel inventory pushed into the global market over the past twelve months in an effort to increase retail sales.

    I suppose we will know more when the fiscal quarter’s results are reported in February. I suspect there’s a reason these changes are being announced ahead of the results. Are these changes being announced now designed to assuage the markets when the quarter’s results show a deteriorating performance picture in a softening global economy?

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    Posted: 31 December 2008 10:27 AM #1

    Dell restructures again. This time with more feeling!  :wink:


    Black Swan Counter: 9 (Banks need money, Jobs needs a break, Geithner has no plan, Cuomo’s grandstanding, .Gov needs a hobby, GS works for money, flash crash, is that bubbling crude?).

    For those who look, a flash allows one to see farther.