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CNBC's Goldman: Michael Dell's "Dell-emma"

Forget those primtetime soap stars, the newest drama people are talking about stars MichaelDell. The 41 year-old has returned to the role of Chief Executive of the computer company that bears his name. He's replacing Kevin Rollins effective immediately. The upheaval could mark a new and compelling chapter in the company's history. Can Dell defy the challenges and turn his company around?" We asked CNBC’s Silicon Valley Bureau Chief, Jim Goldman.

“Michael Dell returned to the company at a critical point in time,” explained Goldman. “During Kevin Rollins' tenure, Dell was battered by a recall of millions of potentially flammable notebook batteries made by Sony and by disappointing earnings. In addition, the company's accounting practices also are the subject of federal scrutiny.

Goldman went on to say that Wall Street's reaction to the CEO change has been fast and furious. JP Morgan and Merrill Lynch both upgraded Dell shares immediately. Citigroup reiterated its "Buy" on the stock.”

Investors seem to be betting Michael Dell can turn his company around sooner rather than later. “I think Michael returning to the company in an of itself creates some excitement among the employees,” explained Harry Blount, an analyst from Lehman Brothers, “But it’s going to take multiple quarters if not years to fix some of these structural issues.”

Other Wall Street analysts aren't upbeat, at all. “If you think back 5 years ago. Dell was the hot sexy computer to buy.” said ThinkEquity Director of Research, Eric Ross. “You had the Dell dude, I mean everyone wanted a Dell. Now if you think about what computers are hot and sexy it's Apple and it's HP. If you think about Dell it's kind of stogie quite frankly “

“That’s a real problem,” added Goldman. And the numbers don't look good either. Hewlett Packard shipped 11.7 million PCs last quarter, a 24% jump, year over year. Dell shipped 9.4 million units, an 8.7% drop.

Although those numbers are weak, they don’t seem to be dragging down Michael Dell’s enthusiasm. “I’m very excited to be CEO again, said Dell. ”I feel the same kind of energy and drive as when we started the company in 1984.”

Down the road this story could take some interesting turns. “The old business model isn’t going to work and that leads to Dell 2.0” added Harry Blount. “which we have not heard a lot about but the company is starting to talk about. And I think part of the 2.0 strategy will be mergers and acquisitions. Dell will become an acquirer.”

As CNBC's Mark Haines remarked on air, it's a calculated bet. "But if you have to bet, Michael Dell isn't a bad guy to bet on, at all."

(Michael Dell has served as Chairman since founding the company in 1984, and was CEO until 2004.)

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