Dell Technologies Inc. (DELL) Stock Analysis
Dell Technologies Inc. (DELL) Stock Analysis
Analysis from 10-Q filed 2025-12-09. Data as of Q4 2025.
Overall Grade: F (Concerning)
Dell Technologies Inc. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 23.3% | Above industry average |
| FCF Margin | 4.3% | Cash flow pressure |
| Debt/Equity | -11.9x | Conservative leverage |
Investment Thesis: Strong return on invested capital of 23.3% suggests durable competitive advantages and efficient capital allocation.
Explore Dell Technologies Inc.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: Dell Technologies Inc. earns 23.3% ROIC, Top 25% in Technology
Dell Technologies Inc.'s trailing-twelve-month ROIC of 23.3% ranks Top 25% in Technology companies (sector median: 5.2%), driven by NOPAT margin of 5.6% combined with asset turnover of 1.2x. Source: 10-Q filed 2025-12-09. Gross margin of 20.8% with operating margin at 6.9% reflects a competitive pricing environment.
| Metric | DELL | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 23.3% | Excellent | Above sector median of 5.2% |
| Return on Equity (ROE) | -214.3% | Red flag | Moderate equity returns |
| Gross Margin | 20.8% | Adequate | Competitive pricing environment |
| Operating Margin | 6.9% | Adequate | Moderate operational efficiency |
Cash Flow: Dell Technologies Inc. generates $4.4B FCF at 4.3% margin, positive NaN/8 quarters
Dell Technologies Inc. generated $4.4B in free cash flow (TTM), a 4.3% FCF margin, a margin that ranks Bottom 50% in Technology. Operating cash flow exceeds net income by 1.4x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-12-09.
| Metric | DELL | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 4.3% | Warning | Thin cash margins |
| Free Cash Flow (TTM) | $4.4B | Good | Positive cash generation |
| OCF/Net Income | 1.4x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: Dell Technologies Inc. at -11.9x leverage
Dell Technologies Inc.'s debt-to-equity ratio of -11.9x reflects conservative leverage. Total debt of $31.2B offset by $9.6B in cash. Source: 10-Q filed 2025-12-09.
| Metric | DELL | Rating | Context |
|---|---|---|---|
| Debt to Equity | -11.9x | Excellent | Conservative capital structure |
| Net Cash Position | $-21.7B | Warning | Net debt position |
Valuation: Dell Technologies Inc. trades at 21.3x earnings
Dell Technologies Inc. trades at a P/E of 21.3x. Free cash flow yield of 4.0% reflects market expectations for growth.
| Metric | DELL | Rating | Context |
|---|---|---|---|
| P/E Ratio | 21.3x | Adequate | Premium valuation |
| EV/Sales | 1.0x | Excellent | Attractive revenue multiple |
| FCF Yield | 4.0% | Good | Lower cash yield |
| Dividend Yield | 1.2% | Adequate | Growth focus over income |
Capital Allocation: Dell Technologies Inc. returns 5.7% shareholder yield
Dell Technologies Inc.'s total shareholder yield is 5.7% (dividends 1.2% + buybacks 4.4%). Source: 10-Q filed 2025-12-09.
| Metric | DELL | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 5.7% | Good | Dividend + buyback yield combined |
| Buyback Yield | 4.4% | Good | Active share repurchases |
| Total Capital Returned (TTM) | $6.3B | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 23.3% | Top 25% | 4.5x above |
| Free Cash Flow Margin | 4.3% | Bottom 50% | 0.5x below |
| Gross Margin | 20.8% | Bottom 25% | 0.4x below |
| Operating Margin | 6.9% | Top 50% | 1.4x above |
| Return on Equity (ROE) | -214.3% | Top 5% | -43.8x below |
| P/E Ratio | 21.3x | N/A | - |
Financial Scorecard
| Metric | DELL | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 23.3% | Excellent | Top 25% of sector (median: 5.2%) |
| Free Cash Flow Margin | 4.3% | Warning | Bottom 50% of sector (median: 9.1%) |
| Gross Margin | 20.8% | Adequate | Bottom 25% of sector (median: 51.8%) |
| Debt to Equity Ratio | -11.9x | Excellent | Conservative capital structure |
| P/E Ratio (Price-to-Earnings) | 21.3x | Adequate | Fair value |
| Free Cash Flow Yield | 4.0% | Adequate | Moderate yield |
Frequently Asked Questions
Q: What is Dell Technologies Inc.'s Return on Invested Capital (ROIC)?
Dell Technologies Inc. (DELL) has a trailing twelve-month Return on Invested Capital (ROIC) of 23.3%. This compares above the sector median of 5.2%. An ROIC above 20% indicates exceptional capital efficiency and strong competitive advantages.
Q: What is Dell Technologies Inc.'s Free Cash Flow Margin?
Dell Technologies Inc. (DELL) has a free cash flow margin of 4.3%, generating $4.4 billion in free cash flow over the trailing twelve months. A thin FCF margin may indicate heavy reinvestment or operational challenges.
Q: Is Dell Technologies Inc. stock overvalued or undervalued?
Dell Technologies Inc. (DELL) trades at a P/E ratio of 21.3x, which is above the sector median of N/A. The EV/Sales multiple is 1.0x. Free cash flow yield is 4.0%, which is in line with market averages.
Q: Does Dell Technologies Inc. pay a dividend?
Dell Technologies Inc. (DELL) currently pays a dividend yield of 1.2%. Including share buybacks, the total shareholder yield is 5.7%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.
Q: What is Dell Technologies Inc.'s revenue and earnings growth?
Dell Technologies Inc. (DELL) grew revenue by 10.8% year-over-year. Earnings per share increased by 27.1% compared to the prior year. Solid growth above 10% suggests healthy business momentum.
Q: Is Dell Technologies Inc. buying back stock?
Dell Technologies Inc. (DELL) repurchased $4.9 billion of stock over the trailing twelve months. This represents a buyback yield of 4.4%.
Q: How does Dell Technologies Inc. compare to competitors in Technology?
Compared to other companies in Technology, Dell Technologies Inc. (DELL) shows: ROIC of 23.3% is above the sector median of 5.2% (Top 15%). FCF margin of 4.3% trails the sector median of 9.1% (Bottom 36% of sector). Gross margin at 20.8% is 31 percentage points lower than sector peers. These rankings are based on MetricDuck's analysis of all Technology companies with available SEC filings.
Q: What warning signs should I watch for with Dell Technologies Inc.?
Investors in Dell Technologies Inc. (DELL) should monitor these potential warning signs: 1) FCF margin is thin at 4.3%, leaving limited buffer for economic downturns. 2) ROIC has been declining, potentially signaling deteriorating competitive position. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-12-09. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.