Stupid Stock Move of the Day! Dell up?June 13, 2012: 2:47 PM ET
Dell (DELL) is finally parting with some of its cash and will pay a dividend. That is good news and I understand why the stock is rallying on it. But Jeff Reeves at InvestorPlace raises some good points about Dell that I agree with.
Dell is a company with terrible fundamentals. Earnings and sales are expected to slide this year. So while dividends from many companies are like icing on the cake, the payout from Dell is more like a Hail Mary move to lure value/income oriented investors. And Jeff is right that there are many other high-yield plays that also look more attractive, such as Coca-Cola (KO) and Intel (INTC).
Still, the Dell dividend does make me wonder if shareholders may soon press Google (GOOG) to part with some of its nearly $50 billion in cash.
After all, nearly all the mega-cap techs with tons of cash pay dividends. Sure, Google isn't as mature as Microsoft (MSFT), Cisco (CSCO) or Dell. But Apple (AAPL) isn't exactly slowing down ... and it's finally about to start paying a dividend.