Dell Technologies to Benefit from AI Growth, Bernstein Says
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy DELL?
Source: CNBC
- Investment Rating Upgrade: Bernstein reiterated its outperform rating on Dell Technologies and raised its price target from $180 to $220, reflecting strong confidence in the company's future growth and implying a 53% upside potential for the stock.
- Strong Stock Performance: Dell's shares have surged 17% this year and over 60% in the past 12 months, demonstrating market recognition of its performance in the AI sector and further solidifying its market position.
- Record AI Server Orders: In the recent FQ4'26, Dell reported quarterly AI server revenues of $9 billion, total orders of $34.1 billion, and a record AI backlog of $43 billion, indicating robust demand from enterprise clients.
- Future Growth Expectations: Analysts expect Dell's AI server revenue to reach $50 billion by fiscal year 2027, representing a year-over-year growth of 100%, while maintaining confidence in its AI margins, suggesting a further consolidation of its leadership position in the market.
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Analyst Views on DELL
Wall Street analysts forecast DELL stock price to rise
15 Analyst Rating
11 Buy
3 Hold
1 Sell
Moderate Buy
Current: 147.370
Low
113.00
Averages
164.85
High
180.00
Current: 147.370
Low
113.00
Averages
164.85
High
180.00
About DELL
Dell Technologies Inc. is engaged in designing, developing, manufacturing, marketing, selling, and supporting a wide range of comprehensive and integrated solutions, products, and services. The Company operates through two segments: Infrastructure Solutions Group (ISG) and Client Solutions Group (CSG). Its ISG segment enables the Company’s customer’s digital transformation with solutions that address artificial intelligence (AI), machine learning, data analytics, and multi cloud environments. Its comprehensive storage portfolio includes modern and traditional storage solutions, including all-flash arrays, scale-out file, object platforms, hyper-converged infrastructure, and software-defined storage. Its CSG segment offers branded personal computers (PCs) including notebooks, desktops, and workstations and branded peripherals that include displays, docking stations, keyboards, mice, and webcam and audio devices, as well as third-party software and peripherals.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Dell Technologies to Benefit from AI Growth, Bernstein Says
- Investment Rating Upgrade: Bernstein reiterated its outperform rating on Dell Technologies and raised its price target from $180 to $220, reflecting strong confidence in the company's future growth and implying a 53% upside potential for the stock.
- Strong Stock Performance: Dell's shares have surged 17% this year and over 60% in the past 12 months, demonstrating market recognition of its performance in the AI sector and further solidifying its market position.
- Record AI Server Orders: In the recent FQ4'26, Dell reported quarterly AI server revenues of $9 billion, total orders of $34.1 billion, and a record AI backlog of $43 billion, indicating robust demand from enterprise clients.
- Future Growth Expectations: Analysts expect Dell's AI server revenue to reach $50 billion by fiscal year 2027, representing a year-over-year growth of 100%, while maintaining confidence in its AI margins, suggesting a further consolidation of its leadership position in the market.
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- Investor Sentiment Deteriorates: Heightened concerns over economic slowdown have negatively impacted market sentiment, and the poor performance of tech stocks could affect overall market stability.
- Significant Industry Impact: The decline in tech stocks may adversely affect the financing capabilities and investor confidence of related companies, potentially hindering future technological innovation and development.
- Increased Market Volatility: As tech stocks slide, market volatility may increase, prompting investors to navigate potential market risks with caution.
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Dell CEO: Government Shouldn't Be Dictated on Tech Use
- Government Tech Usage Rights: Dell Technologies CEO Michael Dell stated in a Bloomberg TV interview that government contractors cannot dictate how the government uses their technologies, emphasizing that such a model is unworkable, which highlights the importance of government autonomy.
- Impact on Anthropic: Dell's comments were in response to the Trump administration designating Anthropic as a 'supply chain risk' after it failed to reach an agreement with the Pentagon, resulting in government agencies and contractors needing to phase out its products, potentially affecting Anthropic's market share.
- Legal Action Dynamics: Anthropic is suing to overturn this designation, demonstrating the company's strong opposition to government decisions, which may spark broader legal and policy discussions that could influence compliance strategies for other companies in the industry.
- Industry Outlook: Dell's remarks not only reflect concerns over regulatory oversight of technology usage but may also impact the policy direction of the entire tech industry, especially as AI technology becomes increasingly significant, prompting companies to reassess their partnerships with the government.
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- Crude Oil Surge: Despite a record release of reserves by the IEA, crude oil prices have surged, leading to a decline in market sentiment as investors grow increasingly concerned about the potential impact on future economic growth.
- Market Decline: Major stock indices fell broadly in response to rising oil prices, reflecting worries that increased energy costs could negatively affect corporate profits, particularly in a high-inflation environment.
- AI Stocks Shine: In contrast to the overall market downturn, positive news from Nvidia and Oracle boosted AI-related stocks, indicating that investor confidence in this sector remains robust despite broader market challenges.
- Geopolitical Impact: The ongoing tensions from the Iran conflict have heightened market uncertainty, with investors expressing concerns over potential disruptions to energy supply chains, thereby affecting overall market performance.
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Block and Dell Technologies Stocks Surge on AI-Driven Earnings
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- Analyst Cost Savings Forecast: Bernstein analysts estimate that Block's restructuring plan will save $750 million by 2026 and $1 billion annually, highlighting the strategic value of the company's investment in AI.
- Dell Technologies' Strong Performance: Dell's stock jumped 21% since last week, with Q4 revenue up 39% year-over-year, and AI-optimized server sales skyrocketing by 342%, indicating robust market demand.
- Future Growth Expectations: Dell anticipates 23% revenue growth and 33% earnings growth for the fiscal year, with AI server sales expected to rise by 103%, while its stock trades at a low 11 times forward earnings, indicating strong investment potential.
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Notebook Prices May Rise by 40% Amid Supply Chain Pressures
- Price Increase Pressure: According to TrendForce, with an average retail price of $900, notebook brands may need to raise prices by at least 30% to maintain current profit margins, which will directly impact consumer purchasing decisions.
- Rising Material Costs: If both memory and CPU prices increase, their combined share of the bill of materials could rise from 45% to around 58%, indicating a significant increase in overall production costs that forces manufacturers to adjust pricing strategies.
- Major Manufacturers' Responses: HP is securing memory supply through strategic inventory with new suppliers, while Dell relies on long-term service agreements to keep hardware within customer budgets, demonstrating proactive strategies in addressing supply chain challenges.
- Weak Market Demand: Despite rising memory and processor prices, the overall demand for notebooks remains weak, creating a contradictory market environment that puts dual pressure on manufacturers regarding pricing and cost control, potentially leading to further price increases for future products.
See More
Dell Technologies to Benefit from AI Growth, Bernstein Says
- Investment Rating Upgrade: Bernstein reiterated its outperform rating on Dell Technologies and raised its price target from $180 to $220, reflecting strong confidence in the company's future growth and implying a 53% upside potential for the stock.
- Strong Stock Performance: Dell's shares have surged 17% this year and over 60% in the past 12 months, demonstrating market recognition of its performance in the AI sector and further solidifying its market position.
- Record AI Server Orders: In the recent FQ4'26, Dell reported quarterly AI server revenues of $9 billion, total orders of $34.1 billion, and a record AI backlog of $43 billion, indicating robust demand from enterprise clients.
- Future Growth Expectations: Analysts expect Dell's AI server revenue to reach $50 billion by fiscal year 2027, representing a year-over-year growth of 100%, while maintaining confidence in its AI margins, suggesting a further consolidation of its leadership position in the market.
See More
Tech Stocks Decline Late Thursday Afternoon
- Market Weakness: Tech stocks broadly declined late Thursday afternoon, reflecting a cautious investor sentiment that may lead to short-term capital outflows from the technology sector.
- Investor Sentiment Deteriorates: Heightened concerns over economic slowdown have negatively impacted market sentiment, and the poor performance of tech stocks could affect overall market stability.
- Significant Industry Impact: The decline in tech stocks may adversely affect the financing capabilities and investor confidence of related companies, potentially hindering future technological innovation and development.
- Increased Market Volatility: As tech stocks slide, market volatility may increase, prompting investors to navigate potential market risks with caution.
See More
Dell CEO: Government Shouldn't Be Dictated on Tech Use
- Government Tech Usage Rights: Dell Technologies CEO Michael Dell stated in a Bloomberg TV interview that government contractors cannot dictate how the government uses their technologies, emphasizing that such a model is unworkable, which highlights the importance of government autonomy.
- Impact on Anthropic: Dell's comments were in response to the Trump administration designating Anthropic as a 'supply chain risk' after it failed to reach an agreement with the Pentagon, resulting in government agencies and contractors needing to phase out its products, potentially affecting Anthropic's market share.
- Legal Action Dynamics: Anthropic is suing to overturn this designation, demonstrating the company's strong opposition to government decisions, which may spark broader legal and policy discussions that could influence compliance strategies for other companies in the industry.
- Industry Outlook: Dell's remarks not only reflect concerns over regulatory oversight of technology usage but may also impact the policy direction of the entire tech industry, especially as AI technology becomes increasingly significant, prompting companies to reassess their partnerships with the government.
See More
Stocks Decline as Crude Oil Prices Surge Amid Iran Conflict
- Crude Oil Surge: Despite a record release of reserves by the IEA, crude oil prices have surged, leading to a decline in market sentiment as investors grow increasingly concerned about the potential impact on future economic growth.
- Market Decline: Major stock indices fell broadly in response to rising oil prices, reflecting worries that increased energy costs could negatively affect corporate profits, particularly in a high-inflation environment.
- AI Stocks Shine: In contrast to the overall market downturn, positive news from Nvidia and Oracle boosted AI-related stocks, indicating that investor confidence in this sector remains robust despite broader market challenges.
- Geopolitical Impact: The ongoing tensions from the Iran conflict have heightened market uncertainty, with investors expressing concerns over potential disruptions to energy supply chains, thereby affecting overall market performance.
See More
Block and Dell Technologies Stocks Surge on AI-Driven Earnings
- Block's Restructuring Plan: Block's stock surged 24% following its Q4 earnings report, with plans to lay off 4,000 employees and reduce staff by 40%, leveraging AI to enhance efficiency, projecting an 18% increase in gross profit and a 54% rise in earnings.
- Analyst Cost Savings Forecast: Bernstein analysts estimate that Block's restructuring plan will save $750 million by 2026 and $1 billion annually, highlighting the strategic value of the company's investment in AI.
- Dell Technologies' Strong Performance: Dell's stock jumped 21% since last week, with Q4 revenue up 39% year-over-year, and AI-optimized server sales skyrocketing by 342%, indicating robust market demand.
- Future Growth Expectations: Dell anticipates 23% revenue growth and 33% earnings growth for the fiscal year, with AI server sales expected to rise by 103%, while its stock trades at a low 11 times forward earnings, indicating strong investment potential.
See More
Notebook Prices May Rise by 40% Amid Supply Chain Pressures
- Price Increase Pressure: According to TrendForce, with an average retail price of $900, notebook brands may need to raise prices by at least 30% to maintain current profit margins, which will directly impact consumer purchasing decisions.
- Rising Material Costs: If both memory and CPU prices increase, their combined share of the bill of materials could rise from 45% to around 58%, indicating a significant increase in overall production costs that forces manufacturers to adjust pricing strategies.
- Major Manufacturers' Responses: HP is securing memory supply through strategic inventory with new suppliers, while Dell relies on long-term service agreements to keep hardware within customer budgets, demonstrating proactive strategies in addressing supply chain challenges.
- Weak Market Demand: Despite rising memory and processor prices, the overall demand for notebooks remains weak, creating a contradictory market environment that puts dual pressure on manufacturers regarding pricing and cost control, potentially leading to further price increases for future products.
See More
