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Investing.com - UBS raised its price target on Dell (NYSE:DELL) to $155 from $145 while maintaining a Buy rating, citing strong artificial intelligence (AI) server revenue that drove quarterly results above expectations. The technology giant, currently valued at $90.7 billion and showing a remarkable 31.8% return over the past six months, is trading slightly above its InvestingPro Fair Value.
Dell reported revenue of $29.8 billion, exceeding UBS’s estimate of $29.1 billion, with AI server revenue reaching $8.2 billion compared to the analyst’s $7 billion projection. The company posted earnings per share of $2.32, surpassing UBS’s forecast of $2.25. With trailing twelve-month revenue of $101.5 billion and a PEG ratio of 0.86, Dell shows strong growth potential relative to its current valuation, according to InvestingPro data.
The technology company’s Client Solutions Group (CSG) business grew approximately 1%, which UBS noted was about 500 basis points slower than competitor HP, while storage revenue declined roughly 3%, missing estimates by approximately 6%.
Gross margin fell to 18.7% versus UBS’s 19.2% estimate, pressured by the strong mix toward AI server revenue, though this was partially offset by a shift within storage to more margin-rich Dell intellectual property. InvestingPro analysis reveals that weak gross profit margins remain a challenge, with the company’s overall margin at 21.27% for the last twelve months.
Dell increased its fiscal year 2026 AI revenue target to $20 billion from its previous forecast of more than $15 billion, which UBS indicated was in line with investor expectations heading into the earnings report. For deeper insights into Dell’s financial health, growth prospects, and 12 additional exclusive ProTips, investors can access the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Dell Technologies Inc. reported strong financial results for the second quarter of fiscal year 2026. The company exceeded analyst expectations with an earnings per share (EPS) of $2.32, surpassing the forecasted $2.29. Dell also achieved a record revenue of $29.8 billion, which was higher than the anticipated $29.2 billion. These results underscore Dell’s robust performance in the recent quarter. The positive earnings report highlights the company’s ability to surpass market expectations. Analysts had projected slightly lower figures, making Dell’s achievement noteworthy. These recent developments reflect Dell’s financial health and operational success.
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