S&P Analyst 'Confident' on Dell, Boosts Stock Rating

Following Dell’s news on improving margins and the firm's "ability to weather a weakened consumer PC market," Tom Smith, computer hardware analyst at Standard & Poor's Equity Research, said he raised his rating on the stock to “buy” from “hold.”

“I’m having more confidence that [Dell] can sustain this” improvement, Smith told CNBC.

“For the past 2 to 3 years, my confidence in Dell was a little bit shaky because they were hitting gross margin in one quarter and not in the next—but here, for the past two quarters, they seem to have gotten it together.”

The computer maker posted earnings that easily exceeded Wall Street estimateson Tuesday, though the firm handed in revenue that fell just shy of analysts' forecasts. Dell also reported an adjusted gross margin of 23.4 percent.

Smith added that he expects Dell’s operating margins to continue improving.

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Smith does not own shares of DELL.