artificial intelligence (Aye) Related hardware topics are fermenting. Melius Research analyst Ben Reitz believes that Dell Technologies will benefit from the development of AI and considers its current stock price to be undervalued.
Melius first tracked Dell, giving it a “buy” rating and a $95 target price. Based on Dell’s closing price on Monday, there is about 30% room for growth. Dell shares closed 0.2% lower at $73.36 on Monday.
Reitz predicts that over the next few months, an “AI halo effect” will appear across Dell’s product portfolio, and sales of personal computers (PCs) and servers will increase. In addition to PCs entering the upgrade wave, Dell will also enter AI servers (see results).
Although Dell has gained more than 80% this year, it still trades at just 11 times estimated earnings.
Reitzes wrote: “Dell has superior scale, is a structural market player, and has an experienced management team, which deserves a sustained premium compared to its peers.”
Reitzes said Dell is positioning itself as a provider of AI solutions, including hardware, software and services. He noted that Dell is “accelerating a server product line optimized for offloading AI workloads”, adding AI to the software portfolio. Adding elements, and also working with AI semiconductor leaders.Huida(Nvidia), Advanced Micro Devices (AMD) and Intel (Intel).
At the same time, he expects PC demand to improve, and enterprise demand may accelerate the replacement cycle.MicrosoftWindows 10 drivers are planned to be discontinued in 2025. He said that as new generative AI applications emerge and processing moves toward edge computing, demand for PCs, servers and storage will benefit in the long term.