Dell Inc.
1. Net Revenue, Net Income, Return on Assets (ROA) and Return on Equity (ROE) of Dell Corporation from 2008 to 2012.
Dell /Year | Net Revenue($B) | Net Income($B) | ROA(%) | ROE(%) | 2008 | 61.133 | 2.947 | 10.69 | 78.90 | 2009 | 61.101 | 2.478 | 9.35 | 58.01 | 2010 | 52.902 | 1.433 | 4.26 | 25.40 | 2011 | 61.494 | 2.635 | 6.83 | 33.92 | 2012 | 62.071 | 3.492 | 7.84 | 39.16 |
2. Dell Inc. share prices from 1998 to 2013.
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Forecast Earnings Growth | |
According to the graph above, over the next five years, the analysts that follow Dell, are expecting it to grow earnings at an average annual rate of 1.96%. This year, analysts are forecasting earnings decrease of 19.82% over last year. Analysts expect earnings growth next year of -2.88% over this year’s forecasted earnings. Thus, based on this information and the first chart, considering that stock price did not have such a very high variation after the recession of 2008-2009, it is not expected such a great difference on the performance of Dell at the end of the next five years.
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3. Major root cause of the Dell’s recent setback and the particular performance that might have avoided the problem.
The main cause of Dell’s setback was the priority strategies with short-term results. Furthermore, after an investigation, the company found out that some managers falsified quarterly results to meet sales targets from 2003 to 2006. The performance evaluation tool called MBWA (Management by walking around) could be used to track how well the strategy execution were going, talking with different people at many different levels such as speaking with those managers and employees for deciding whether to continue or change the company’s vision, objectives, strategy and /or strategy execution methods. It would be a way to evaluate the company’s progress and making corrective adjustments in order to avoid Dell’s problem.
4. Three distinct ways in which Dell’s business strategy is
Dell /Year | Net Revenue($B) | Net Income($B) | ROA(%) | ROE(%) | 2008 | 61.133 | 2.947 | 10.69 | 78.90 | 2009 | 61.101 | 2.478 | 9.35 | 58.01 | 2010 | 52.902 | 1.433 | 4.26 | 25.40 | 2011 | 61.494 | 2.635 | 6.83 | 33.92 | 2012 | 62.071 | 3.492 | 7.84 | 39.16 |
2. Dell Inc. share prices from 1998 to 2013.
.
Forecast Earnings Growth | |
According to the graph above, over the next five years, the analysts that follow Dell, are expecting it to grow earnings at an average annual rate of 1.96%. This year, analysts are forecasting earnings decrease of 19.82% over last year. Analysts expect earnings growth next year of -2.88% over this year’s forecasted earnings. Thus, based on this information and the first chart, considering that stock price did not have such a very high variation after the recession of 2008-2009, it is not expected such a great difference on the performance of Dell at the end of the next five years.
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3. Major root cause of the Dell’s recent setback and the particular performance that might have avoided the problem.
The main cause of Dell’s setback was the priority strategies with short-term results. Furthermore, after an investigation, the company found out that some managers falsified quarterly results to meet sales targets from 2003 to 2006. The performance evaluation tool called MBWA (Management by walking around) could be used to track how well the strategy execution were going, talking with different people at many different levels such as speaking with those managers and employees for deciding whether to continue or change the company’s vision, objectives, strategy and /or strategy execution methods. It would be a way to evaluate the company’s progress and making corrective adjustments in order to avoid Dell’s problem.
4. Three distinct ways in which Dell’s business strategy is
References: http://i.dell.com/sites/content/corporate/secure/en/Documents/FY12_Form10K.pdf http://finance.yahoo.com/echarts?s=DELL+Interactive#symbol=DELL;range= http://www.nasdaq.com/symbol/dell/earnings-growth#.URhnGh1lX0U http://www.nytimes.com/2007/09/09/technology/09dell.html?pagewanted=all&_r=0 http://news.cnet.com/2100-1040-942527.html