Tags: JPMorgan | Bullish | Dell | Stock

Forbes.com: JPMorgan Turns Bullish on Dell Stock

By    |   Friday, 03 February 2012 12:48 PM

JPMorgan has had a change of heart about Dell. The firm issued a research note upgrading the company to overweight from underweight, Forbes.com reported.

The financial giant believes that in the next three to six months, Dell may pave a path to 4 percent to 5 percent revenue growth and that enduring gross margin improvements could see growth approach 10 percent in the long term.

“A big thrust to our call is that we believe that Dell is almost there in terms of completing its revenue pruning,” Forbes says analyst Mark Moskowitz wrote in the note.

But, in addition to getting its finances in order, Dell needs to be ready to play ball in the modern technology market. The company has a reputation for computers, and rightfully so since it is the third largest PC maker by sales. But there are concerns that the PC market is softening.

Still, Dell's stock is up 18.9 percent year-to-date according to the research note, Forbes reports. And, the company apparently isn't standing by idly, but is instead aiming to prosper in new markets.

Market Watch reported that Dell is focusing on high-margin business products including storage systems, security, services and networking.

JPMorgan appears optimistic about Dell's prospects going forward.

Among the reasons the firm is bullish on the PC maker is that they believe Dell can compete in storage, which offers above peer growth potential and that Ultrabooks and the arrival of Windows 8 could have a positive impact on sales, Forbes reports.

“We might be late, but we see plenty of upside,” Moskowitz wrote in the note.

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Friday, 03 February 2012 12:48 PM
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