Dell CEO buys big chunk of Dell

DELL CHAIRMAN AND CEO, Michael Dell, is stocking up on shares in his own firm, by buying a whopping 4.8 million at a value of around $100 million, according to a regulatory filing with the US Securities and Exchange Commission yesterday.

The Dell top man apparently shelled out for 3.5 million shares last Thursday, at $20.42 a share, and bought another 1.38 million on Friday for $20.67 a share.

Prices for the second biggest PC maker have been plummeting over the past year, falling about 26 per cent from $30.77 last October and hitting a new 52-week low of $18.13 recently.

The stock drop seems to be the result of substandard earnings and disappointing profits, which have fallen below even the most pessimistic analyst’s predictions. The firm’s consumer business even reported a painful $5 million loss in Q2 of 2008, which it blamed mainly on high manufacturing costs.

It also emerged last week that Dell was frantically hoping to offload some, if not all, of its factories to contract computer manufacturers which would purportedly help cut costs by about $3 billion and improve profitability somewhat.

It’s not the first time the company’s namesake has coughed up for shares in his business either. On June 27 Dell bought himself 2.23 million shares at 49.9 million, following that up with 2.19 million shares June 30 for $2.2 million and 2.17 million shares at $47.6 million on July 1^st.

Yesterday shares in the firm dropped again by one per cent, closing at $20.17, but they did go up again by 2.4 per cent in extended trade. µ

L’Inq
Bloomberg

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