Post Apple Earnings: Which Computer Stocks have the Strongest Earnings Trends?

January 24, 2013

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 4 computer stocks rank via earnings trends:

Dell Inc. (NASDAQ:DELL): Current Price $13.07

Fiscal Year	2008	2009	2010	2011	2012
Revenue ($) in millions	61,130	61,100	52,900	61,490	62,070
Diluted EPS ($)	1.31	1.25	0.73	1.35	1.88

Dell is not doing much in the way of growing its revenue, which has remained essentially flat over the five year span we see here. However, EPS has shown a rising trend from 2010 through 2012.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter	Oct. 31, 2011	Jan. 31, 2012	Apr. 30, 2012	Jul. 31, 2012	Oct. 31, 2012
Revenue ($) in millions	15,360	16,030	14,420	14,480	13,720
Diluted EPS ($)	0.49	0.42	0.36	0.42	0.27

On its quarterly results, Dell is facing falling sales and erratic EPS. In the latest quarter, EPS is the lowest among all the five quarters reviewed here. Dell does not quite make the grade…

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