Tomahawk, WI 7/31/2013 (Basicsmedia) – What is the reason behind the latest trend which depicts Dell Inc.’s (NASDAQ:DELL) stocks as being among the most traded in Nasdaq? Any slight change in trading on any stock, regardless of the company in question, should always make investors to look for solutions and answers quickly. This is because stock doesn’t get actively traded from nowhere and there must always be a reason behind such a trend or scenario. This article seeks to examine DELL’s financial results and the ongoing within the company to find out whether investors should be worried, or whether this is a sign of good things which are in the offing.

Is DELL’s Stock Overtraded or Actively traded?

There is a huge difference between overtrading and active trading. DELL is currently going through a stage where its stock is being actively traded as opposed to overtrading. It is worth remembering that overtrading often denotes the presence of problems, which are more than likely to crop up later. Actively traded stocks are not known to suffer the same predicament later, hence the need for looking at them using better standards. There is a lot of buying and selling taking place right now with regard to DELL’s stocks, and this could be construed as either good or bad news, depending with the investor in question.

Often, when a company’s stock is actively traded, it could either signify that there is or has been a huge amount of shares which are outstanding, hence being released into the market thus creating the increased act of buying and selling. When unexpected news takes place regarding the company in question, this could also create a scenario where stock is actively traded. If a tender offer is made by other company or investors for the business, this could also lead to a situation where its stock is actively traded at Nasdaq, or with any other stock exchange where it is quoted. Which is the case with DELL?

If you follow financial news keenly, you would observe that there has been a lot of debate surrounding DELL’s battle or public tiff with Icahn. This tiff emanates from an agreement between DELL and Silver Lake regarding a possible merger and whether to make the company private or leave it as it is. There is a very high possibility that the active trading in DELL’s stock has been occasioned by this unexpected turn of events, which have led to a drop in its stock price. You will notice, from the diagram below, that DELL’s stock price has been on a downward trend in the latest quarter and hasn’t been able to get to the highs of March 2013. The dividend itself hasn’t improved from the current amount of $0.08, which was first declared in September 2012, and has remained the same until today.

8dell

This diagram shows the drop in DELL stock from March 2013 to date. Chart is courtesy of http://finance.yahoo.com/q/bc?s=DELL+Basic+Chart.

What Does All This Mean for DELL?

DELL must go through this period while ensuring that it doesn’t suffer by losing or ceding more ground to its competitors such as Hewlett Packard Company, or Acer Incorporated, or Lenovo Group Ltd. It is currently the second largest in terms of market capitalization, number of employees, revenue and net income behind Hewlett Packard Company. What would be my advice? DELL is a recognizable brand all over the world. Therefore, its stock is more or less stable and investors have continued to show their trust and confidence in the company. However, a lot of caution is required going forward.

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