Dell (DELL) Lower on Cautious Margin View

Shares of Dell (Nasdaq: DELL) are falling 3% after-hours Monday after the PC maker said it sees a slight sequential revenue growth in the second quarter but also sees modest margin pressure. Analysts had been looking for about a 2% sequential rise in revenue and also a rise in margin.

For the margin decline, Dell cited higher component costs, a competitive pricing environment, and an unfavorable mix of product and business-segment demand.

Dell said year-over-year demand for its information-technology products appears to have stabilized. But while Dell's products and services seems to have stabilized, the company said it varies significantly by customer segment and geography.

Over a longer time horizon, Dell is targeting 5 to 7 percent compounded annual sales growth, operating income at or above 7 percent of revenue, and cash flow from operations exceeding net income.

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