Evercore ISI holds Dell stock Outperform rating, $120 target

Tuesday, Dell Technologies Inc (NYSE:DELL), the $78 billion technology hardware giant, maintained its Outperform rating and $120.00 price target, as reiterated by Evercore ISI following key announcements at the annual Dell World conference in Las Vegas, NV. According to InvestingPro analysis, the company is currently trading near its Fair Value, with strong momentum reflected in its 6% gain over the past week. The conference kicked off with a keynote from CEO Michael Dell, highlighting new product launches and partnerships aimed at advancing enterprise artificial intelligence (AI) initiatives.

The new releases include AI servers powered by Blackwell and AMD (NASDAQ:AMD), an AI PC, and various AI networking and managed service offerings. The presentations also featured endorsements from top executives of large global enterprises, discussing the benefits of their collaborations with Dell in pushing forward their AI strategies.

Central to the keynote was the emphasis on accelerating the adoption of Generation AI within enterprises. Dell anticipates that within the next 24 months, 85% of enterprises are expected to shift their Gen AI workloads to on-premises infrastructure due to cost advantages over public cloud solutions. This strategic focus comes as Dell demonstrates solid financial performance, with annual revenue reaching $95.6 billion and a healthy profit margin. InvestingPro data reveals 12 additional key insights about Dell’s financial health and growth prospects.

Evercore ISI believes that Dell’s experience in designing and constructing next-generation AI systems for service providers has provided the company with critical technical knowledge applicable to enterprise-level needs. Additionally, Dell introduced its AI PC portfolio earlier this year and unveiled the Dell Pro Max Plus, a mobile workstation with an enterprise-grade Neural Processing Unit (NPU), facilitating edge inferencing in a portable format.

On the infrastructure front, Dell announced new server offerings that will incorporate B300 and GB300 NVDA chips, which are expected to enhance reasoning inference outputs and throughput.

In conclusion, Evercore ISI underscores Dell’s strategic position to capitalize on the growing demand for enterprise Gen AI adoption. The firm views Dell as a comprehensive solution provider for AI infrastructure requirements throughout the product lifecycle, reaffirming its Outperform rating on the company’s stock. With a P/E ratio of 17.6 and a dividend yield of 1.84%, investors anticipating Dell’s upcoming earnings report on May 29 can access comprehensive analysis and valuation metrics through InvestingPro’s detailed research reports, available for over 1,400 US stocks.

In other recent news, Dell Technologies has made significant advancements in its AI offerings, introducing updates to its Dell AI Factory that include new infrastructure and expanded partnerships. These enhancements are designed to simplify AI deployment for organizations, with the introduction of the Dell Pro Max AI PC and PowerCool Enclosed Rear Door Heat Exchanger, which can reduce cooling energy costs by up to 60%. Dell has also collaborated with NVIDIA (NASDAQ:NVDA) to enhance its AI Factory, incorporating NVIDIA’s technology into its servers to improve AI performance. This includes the upcoming Dell PowerEdge XE7745 server with NVIDIA RTX Pro™ 6000 Blackwell Server Edition GPUs.

Mizuho (NYSE:MFG) Securities has raised its price target for Dell to $145, maintaining an Outperform rating, citing the company’s strong pipeline in the AI Server sector. BofA Securities also maintains a Buy rating with a $150 price target, expecting Dell’s first-quarter financial results to reach the higher end of its guidance. The firm anticipates potential challenges due to tariffs but believes Dell can mitigate these impacts. Raymond (NSE:RYMD) James has increased its price target for Dell to $144, maintaining an Outperform rating, and highlights the company’s potential to sustain growth above historical norms despite near-term risks in AI sales. These recent developments reflect Dell’s strategic focus on expanding its AI capabilities and addressing market dynamics.

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