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Investing.com - BofA Securities raised its price target on Dell (NYSE:DELL) to $165.00 from $155.00 on Friday, while maintaining a Buy rating on the stock. Currently trading at $129.10, Dell has shown strong momentum with a 14% gain over the past six months. According to InvestingPro data, the stock is currently trading near its Fair Value.
The firm cited expected benefits from enterprise and sovereign AI growth over the next decade as the primary driver for the more optimistic outlook.
BofA Securities noted that headwinds from public cloud migrations should reverse over the next decade, shifting from "bloated OpEx to ROI driving Capex" as enterprises implement AI to drive productivity.
The research firm projects Dell will grow its topline by approximately 12% over the next five years, compared to just 2% growth over the previous five-year period.
BofA Securities reiterated its Buy rating, stating the market is still in early stages of AI adoption, with Dell positioned to benefit from strong storage attachment rates and tailwinds from both overall and AI-specific PC refresh cycles.
In other recent news, Dell Technologies reported the conversion of 3,421,793 Class B shares into Class C shares by Silver Lake Partners and its affiliates. The conversion was executed without registration, utilizing an exemption under the Securities Act of 1933. Meanwhile, Mizuho (NYSE:MFG) raised its price target for Dell to $150, maintaining an Outperform rating, citing expectations of increased AI server wins and market share gains. The research firm also adjusted its fiscal 2026 and 2027 revenue forecasts, highlighting Dell’s strong AI server support team and financial capabilities. Additionally, KeyBanc initiated coverage on Dell with a Sector Weight rating, acknowledging the company’s strong management and financial profile but expressing concerns about pressure on gross margins due to AI server growth.
In a separate development, Dell was among several tech companies affected by a Wall Street Journal report on federal contract spending cuts. The General Services Administration issued letters to Dell and others, urging cost-cutting measures as part of a strategy to consolidate federal purchasing. This initiative has introduced additional challenges for tech companies, with heightened scrutiny on government contracts. CoreWeave, in collaboration with Dell, deployed NVIDIA (NASDAQ:NVDA)’s GB300 NVL72 AI platform, marking a significant advancement in AI infrastructure and showcasing Dell’s involvement in cutting-edge technology developments.
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