Shares in Dell (DELL) continued to malfunction today despite analysts talking up the computer group’s AI potential.
Dell stock was down almost 7% at the close of trading yesterday and was off by a similar amount in pre-market trading. This was in the wake of mixed fourth-quarter 2024 financial results and forward guidance that fell short of Wall Street forecasts.
Strong AI Pipeline
However, four-star TipRanks-rated analyst Vijay Rakesh of Mizuho Securities reiterated his Buy rating on the stock with a $140 price target down from $150. He highlighted the company’s strong AI pipeline as being fundamental to the company’s growth prospects. This was despite the group reporting AI server orders down 53% quarter on quarter.
The company sells AI servers that run Nvidia (NVDA) microchips as well as others including Elon Musk’s privately held xAI. Rakesh said that Dell was “well-positioned” with AI server market share and that it had an AI pipeline of between $27 billion to $35 billion. “We see Dell as a leader in enterprise AI,” he said. In addition, he talked up Dell’s commercial personal computer refresh and the company’s plan to drive a $10 billion jump in its stock buyback program.
Five-star TipRanks-rated analyst Aaron Rakers at Wells Fargo also lowered his price target on Dell stock to $150 from $160 but kept a Buy rating. He highlighted Dell’s economies of scale, its PC refresh, strong free cash flow and its buyback plans.
Is DELL a Good Stock to Buy?
On TipRanks, DELL has a Strong Buy consensus based on 13 Buy and 1 Hold rating. Its highest price target is $185. DELL stock’s consensus price target is $145.49 implying an 34.93% upside.
