Eben@CANSLIM ResearchBofA Securities has reiterated its Buy rating on Dell Technologies Inc. (NYSE: DELL) and lifted its price objective to $600 from $505, after the company reported AI server revenue, orders and backlog well ahead of the broker’s forecasts. Dell exited its second fiscal quarter with $95bn in AI server backlog, nearly double the prior quarter, and raised full-year revenue and EPS guidance. The new target implies roughly 20x BofA’s C27 earnings estimate of $30.41 per share.
Key Takeaways
- BofA Securities analyst Wamsi Mohan reiterated a Buy rating on Dell Technologies Inc. (DELL) and raised the price objective to $600 from $505, based on approximately 20x C27E EPS of $30.41.
- Dell reported F2Q AI server revenue of $16.4bn, orders of $60.9bn and backlog of $95bn, against BofA estimates of $15.6bn, $25bn and $61bn respectively.
- Dell raised its F27 revenue guidance at the midpoint by $25bn to $192bn and lifted EPS guidance by $7.60 to $25.50, including a $14bn increase to the AI server revenue guide, now $74bn.
- BofA raised its F27E revenue and EPS to $197bn and $26.35 from $178bn and $19.56, and its C27E EPS to $30.41 from $24.67.
- Infrastructure Solutions Group operating margin expanded 620bps year on year to 15.0%, while Client Solutions Group revenue grew 20% year on year with commercial growth of 22%.
What BofA’s Latest Dell Note Says
In a report titled “Dell Technologies Inc. — Strong quarter and guide; more upside from broad portfolio in C27; PO to $600,” BofA Securities analyst Wamsi Mohan argues that demand continues to outpace supply — by roughly 30% in F27, with a likely wider gap in F28 — creating a solid pricing environment. Component constraints across DRAM, NAND, CPU and HDD, alongside customer data centre readiness, are extending visibility for Dell Technologies Inc. (DELL).
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