Key Stats for DELL Stock
- Past week’s performance: traded lower in recent sessions, with one report noting the stock down about 8.5% during a broader tech sell‑off
- 52-week range: $$66 to $168
- Valuation model target price: $156
- Implied upside: 33.0% over 1.9 years
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What Happened?
Dell Technologies (DELL) stock has pulled back in February as investors rotate out of some AI‑linked hardware names despite resilient fundamentals and strong expectations for the next earnings report.
A recent note highlighted that DELL was trading about 8.5% lower on a down day for the Nasdaq and S&P 500, with the shares also sitting below key moving averages after a powerful run over the past year.
Fundamentals remain robust heading into the next quarter. For fiscal 2025, Dell reported revenue of roughly $95.6 billion, up about 8% year over year, and earnings of $6.38 per share, supported by strong demand for Infrastructure Solutions Group (ISG) products.
In the most recent reported quarter, revenue reached $23.9 billion, up around 7% from a year earlier, with AI‑optimized servers and traditional servers driving a 37% rise in servers and networking revenue to $6.6 billion.
Dell also disclosed that it sold about $10 billion of AI‑optimized servers in fiscal 2025 and forecast AI system sales of about $15 billion in the following year, underscoring how AI demand has become a central growth driver.
Those bullish demand signals contrast with the stock’s short‑term weakness, which has been tied more to market‑wide tech selling, profit‑taking after large gains, and caution ahead of an important earnings call than to any deterioration in Dell’s reported results.
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Is DELL Stock Undervalued?
Under valuation model assumptions realized through January 2028, the stock is modeled using:
- Revenue growth (CAGR): 11.8%
- Operating margins: 8.9%
- Exit P/E multiple: 10.1x
Based on these inputs, the model estimates a target price of $156, implying 33.0% total upside from the current share price of $117 and an 15.6% annualized return over the next 1.9 years.
These assumptions reflect expectations that Dell can sustain high‑single‑ to low‑double‑digit revenue growth while modestly expanding margins as AI‑driven server demand scales and the mix shifts toward higher‑value infrastructure solutions.
The exit multiple of 10.1x sits slightly below Dell’s historical peak valuations but above the lowest trough levels, which aligns with its combination of solid earnings growth, sizable AI opportunities, and a still‑leveraged balance sheet.
This suggests Dell could offer appealing long‑term upside if it continues to execute on AI server shipments, converts its large AI backlog into revenue, and maintains disciplined capital allocation through dividends and buybacks.
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