If You Like Dell Inc. (DELL) So Much, Marry It

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HP is in better shape. It’s the global leader, generating twice the revenue that Dell is ringing up. However, the PC market is so out of favor that HP is fetching a mere seven times this fiscal year’s projected earnings. Applying that multiple to Dell would only price it at a mere $8.68 based on next year’s forecast, and even that may be optimistic. Dell used to trounce Wall Street income estimates, but it has fallen short in two of the past three quarters.

The scary thing for Dell Inc. (NASDAQ:DELL) investors right now is that we are in a global economic recovery. It will be easy to sway shareholders against the exit strategy, arguing that there’s growth to be had — even in the fading PC market — as businesses begin updating their desktops and servers. Dell still has a global brand that’s valuable, and a rising tide should lift its already steady server business and promising enterprise software solutions acquisitions.

That’s the kind of swagger that won’t end pretty.

It won’t be a shock to see Dell Inc. (NASDAQ:DELL) investors pass on $13.65 a share next week. It also won’t be much of a surprise to see Dell’s stock trading much lower than that a year later, now an old maid, telling stories to anyone still willing to listen about the one that got away.

The article If You Like Dell So Much, Marry It originally appeared on Fool.com.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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