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What you need to know
- Dell shares dropped Friday, after the company's quarterly sales and full-year outlook underwhelmed.
- Analysts have suggested buying the dip to take advantage of the AI demand.
- UBS said the soft guidance could have been anticipated and told clients to "buy any weakness in Dell shares."
Dell shares (DELL) fell on Friday following disappointing sales figures for the quarter and a disappointing outlook for the full year. Analysts suggested that it might be a good time to purchase the shares at a discount.
“Buy any weakness in Dell shares,” UBS analysts told clients Friday, and suggested Dell's soft revenue forecast could have been anticipated, given near-term headwinds from unfavorable market conditions.
Visible Alpha reported that Dell expected fiscal 2026 revenue between $101 and $105 Billion, the middle point being below Visible Alpha’s consensus analyst estimate of $103.81 Billion.
UBS lowered its price target slightly to $150 from $158, though even at that level, it would represent a nearly 50% gain from Friday's intraday price around $102. Dell’s shares are down about 6%, and they have fallen close to 12% in the past year.
JPMorgan’s analysts reiterated the $150 price goal and said that they expect to see server makers such as Dell benefiting from a booming AI Infrastructure market. Their estimates could be further boosted by a recovery in the PC and AI market.
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