Jefferies Initiates Coverage On Dell With Hold Rating

According to Jefferies, Dell DELL coverage is initiated with Hold rating. Jefferies said that despite near-term benefits from falling PC component prices and the enterprise PC refresh cycle, we believe Dell has longer-term disadvantages in a tablet and cloud world. “Our $17 target is based on 9x our FY13 EPS estimate, which is below peers' 11x on CY12E and at the lower end of Dell's two-year historical NTM range of 8x-12x (average 10x). We believe a discount is warranted due to long-term tablet and cloud risks.” Dell closed yesterday at $16.65.