Boy, that DELL CEO sure can talk a good game, can’t he? Not sure how that’s all going to work out with HPQ pooping the sheets tonight. No matter, his report is coming up.

So I thought I would take a gander at estimates to see who all was gettin’ jiggy ahead of the HPQ report. At first glance, nothing exciting. We see Goldman lowering by a penny, JPM down by 4c, UBS down by a penny, nothing exciting one way or the other. Then I see Auriga, out of left field, initiated the other day at a full 7% below Consensus – good for him! Too bad Thomson filtered his estimates for being too bearish.

No one meaningfully lowered estimates ahead of the quarter. Apparently, this one totally slipped by folks.

The previews are hysterical. Everyone wants to buy the thing, but everyone is also talking about how HPQ is a little outside of its box guidance-wise and that the coming quarters are pretty risky. If so risky, why not cut numbers?

Even better are initial responses. The poor guy at Citi thinks the multiple can’t contract further, even as he watches the stock crumble after hours.

On the story of the multiple, one needs to consider debt. HPQ is as bad as a Chinese solar company while DELL sports a net cash position. The end result is that comps are based on EV/EBITDA and you can see both trade ~4.5x. Given the level of debt it is incorrect to compare simply on EPS. The Citi analyst can cry all he wants about low valuation and how it can’t get any worse, but it looks to be trading appropriately for something that is not growing.

As for the trade, I clearly missed it. Even if this press release is all a sham and HPQ reports better than expected, I am not sure the stock recovers very quickly. I am more interested in DELL and maybe as a short. If margin guidance sucks, this thing will go right back to $14 and maybe lower.

The bigger issue is for the broader tech market. Maybe this is what Heyler caught wind of on top of the Japanese issue?

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