Dell Technologies Inc. (DELL) just delivered a quarter that made Wall Street sit up and take notice. The stock jumped nearly 29% on Friday, hitting a fresh 52-week high after a blockbuster earnings report. But here's the thing: analysts think the rally might just be getting started.
Melius Research analyst Ben Reitzes told CNBC on Friday that Dell still looks cheap, even after the surge. He pointed out that the company beat expectations across the board, with strength extending well beyond AI servers into traditional servers and PCs. Reitzes highlighted enterprise pricing power, AI-driven network upgrades, and growing PC demand tied to AI workloads as key growth drivers.
He also dismissed concerns about margin pressure, noting that Dell demonstrated strong operating leverage by keeping expenses under control and using AI internally to boost productivity. Reitzes raised his price target to $560 and said Dell could deliver more than 20% long-term earnings-per-share growth while returning increasing amounts of cash to shareholders through robust free cash flow.
Over at Susquehanna, analyst Mehdi Hosseini echoed the optimism. He told CNBC that Dell's earnings strength, margin resilience, and cash-flow generation support a higher valuation. Hosseini argued that Dell should be evaluated on an enterprise value-to-sales basis because the company has maintained high-single-digit margin profiles while generating substantial free cash flow—more than $3 billion in the April quarter alone.
Hosseini also noted that Dell's mix of higher-margin services, storage, and other infrastructure offerings has helped preserve profitability. He suggested that component shortages could defer some revenue into the next fiscal year rather than eliminate demand, which supports the sustainability of future revenue and cash-flow growth. And he added that Dell's comments on persistent memory shortages are positive for suppliers like Micron Technology (MU) and Sandisk Corp. (SNDK).
The analyst consensus on Dell is a Buy, with an average price target of $347.54. But several firms raised their forecasts on Friday, suggesting they see more upside. Truist Securities raised its target to $360 with a Hold rating, Piper Sandler bumped its target to $497 with an Overweight, Wells Fargo went to $505 with an Overweight, and Susquehanna upgraded to Positive with a $700 target.
At the time of publication, Dell shares were trading at $408.93, up 28.98% on the day. That's a new 52-week high, and if the analysts are right, there could be plenty more room to run.
