Catch up on the essentials
- TD Cowen analyst Krish Sankar raised the price target on Dell Technologies to $550 from $500 while keeping a Hold rating, after meeting with Dell’s head of investor relations.
- Dell booked a record $60.9 billion of AI server orders in its fiscal second quarter, more than double the $24.4 billion booked in the prior quarter, lifting backlog to a record $95 billion at quarter-end.
- TD Cowen’s caution on memory aligned with Dell’s own recent commentary that demand remained stronger than supply across both traditional and AI servers, with DRAM and NAND flash expected to remain key constraints into the next year.
Selected from this article · 2026-09-30
Read on for the full pictureTD Cowen target lift and 2027 outlook
TD Cowen analyst Krish Sankar raised the price target on Dell Technologies to $550 from $500 while keeping a Hold rating, after meeting with Dell’s head of investor relations. The firm said Dell’s second-half AI server orders will help calibrate how much upside remains in 2027 AI forecasts, and it pointed to a record $95 billion AI server backlog concentrated among major neocloud customers as the main lever for next year’s outlook. The firm also said a richer mix of AI CPU racks would be positive for margins.
Record backlog and raised fiscal 2027 AI revenue guide
Dell booked a record $60.9 billion of AI server orders in its fiscal second quarter, more than double the $24.4 billion booked in the prior quarter, lifting backlog to a record $95 billion at quarter-end. AI server revenue reached $16.4 billion, and Dell said its AI pipeline continued to grow sequentially and remained multiple times its backlog even after converting $131.7 billion in orders over the prior 12 months. Demand broadened across neocloud, sovereign and enterprise customers, and Dell raised its fiscal 2027 AI server revenue forecast to $74 billion from $60 billion, roughly three times the prior year’s level.
Memory supply as a recurring constraint
TD Cowen’s caution on memory aligned with Dell’s own recent commentary that demand remained stronger than supply across both traditional and AI servers, with DRAM and NAND flash expected to remain key constraints into the next year. The firm framed memory tightness as a risk to the timing and conversion of the $95 billion backlog, even as the order book itself provides a multi-quarter visibility anchor.
Morgan Stanley’s parallel upgrade and HPE preference
Morgan Stanley raised its Dell price target to $511 from $499 the prior week while keeping an Equal Weight rating, calling enterprise hardware spending “undeniably strong” and saying Dell is “clearly out-executing.” Morgan Stanley nonetheless continued to prefer Hewlett Packard Enterprise, rated Overweight, citing the prospect of an earnings handoff from servers to higher-margin networking once the current hardware cycle matures.
Retail sentiment and year-to-date performance
Retail sentiment around Dell shares on Stocktwits was tagged bearish on September 29, even as the stock had rallied roughly 325% year-to-date, against a more than 27% gain for the First Trust Cloud Computing ETF (SKYY), which holds Dell. The disconnect between elevated fundamentals cited by sell-side analysts and softer retail positioning underscores the contested near-term read on Dell’s valuation.
Next milestone
TD Cowen flagged Dell’s second-half AI server order disclosures as the next concrete data point that will shape 2027 AI revenue visibility and test whether memory constraints ease or tighten further.
Share this article
