On Wednesday, BofA Securities maintained a Buy rating and a $150.00 price target for Dell Technologies Inc. (NYSE:DELL), with expectations for the company’s first-quarter financial results to reach the higher end of its guidance. The optimism stems from stronger-than-anticipated PC revenue during the quarter. This confidence appears well-founded, as InvestingPro data shows Dell has achieved an impressive 12.6% return over the past week and maintains a healthy P/E ratio of 17.1x relative to its growth prospects. According to InvestingPro’s Fair Value analysis, Dell is currently trading slightly below its calculated Fair Value.
Wamsi Mohan, an analyst at BofA Securities, increased the earnings per share (EPS) estimate for the first quarter to $1.77, up from the previous $1.66, citing higher Client Solutions Group (CSG) revenues due to demand pull-in. Dell is scheduled to report its first-quarter earnings on May 29, 2025. InvestingPro subscribers can access detailed financial health metrics and 12 additional exclusive ProTips that provide deeper insights into Dell’s performance, including its aggressive share buyback program and consecutive dividend increases over the past three years.
Looking ahead to the full-year 2026 guidance, the analyst anticipates potential downside risks to operating margin (OM) and EPS projections due to tariffs and the overall demand environment. Approximately half of Dell’s revenues come from its CSG segment, which is heavily reliant on products sourced from China. Recent data from InvestingPro shows Dell’s current gross profit margin at 22.4%, with the company generating substantial revenue of $95.6 billion in the last twelve months. Tariffs could significantly affect the company’s gross margins (GMs); however, Mohan believes that Dell can mitigate the impact on operating margins and EPS through strategies such as pre-buying and cost reductions.
Despite the potential challenges, Mohan adjusted revenue estimates for Dell’s Infrastructure Solutions Group (ISG) downwards for fiscal 2026, attributing the change to the impact of tariffs on IT enterprise spending. Conversely, revenue estimates for CSG were lowered, but an increase in the first half of 2026 was projected due to the demand pull-in from tariffs. The revised full-year 2026 revenue and EPS figures are now set at $103.2 billion and $9.16, down from the earlier forecast of $105.3 billion and $9.41.
Mohan’s continued endorsement of a Buy rating is based on the belief that the market is still in the early stages of artificial intelligence (AI) adoption, which could benefit Dell through product mix margins and the ongoing PC refresh cycle. Additionally, longer-term prospects for AI in PCs are seen as a positive tailwind. The price objective remains firm at $150, based on a 15 times multiple of the anticipated calendar year 2026 EPS of $10.20, slightly adjusted from the previous estimate of $10.22.
In other recent news, Dell Technologies has unveiled updates to its server, storage, and data protection portfolios to support data center modernization. These enhancements aim to improve performance and efficiency, particularly in AI and cybersecurity, through products like the Dell PowerEdge servers and PowerStore software updates. Additionally, Dell has announced a $4 billion debt offering, involving senior notes with varying maturities and interest rates, to bolster its financial flexibility. The proceeds are intended for general corporate purposes, including potential debt repayment. Analyst firms have also been active, with Raymond (NSE:RYMD) James raising Dell’s stock price target to $144, citing a positive outlook on the company’s growth prospects despite potential short-term risks. Morgan Stanley (NYSE:MS) maintained an Overweight rating on Dell, highlighting increased orders for AI server systems, which could boost future revenues. Moreover, Dell has partnered with Apple (NASDAQ:AAPL) and Super Micro Computer (NASDAQ:SMCI) in a significant AI server venture, as Apple invests in advanced AI infrastructure to enhance its capabilities. These developments underscore Dell’s strategic efforts to navigate industry shifts and maintain its competitive position.
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