Dell shares rose to a three-month high. The price stood at $142.31 and was on track to make the biggest one-day jump in almost two years.Data center equipment makers like Dell have benefited from the rapid growth of AI investors, with industry leaders expected to spend at least $630 billion this year.
Dell said it expects AI server revenue to grow 103% to about $50 billion in fiscal 2027.
At least seven Wall Street brokers raised price targets for the stock, with JPMorgan expecting the stock to rise at least 36% over the next year from Thursday’s close to $165.
Dell’s ability to handle cyclical challenges comes from its leading position in AI compute for Tier 2 Cloud and Enterprises, where the significant revenue shift can give the company much more flexibility in managing operating margin and earnings results, analysts led by JPMorgan’s Samik Chatterjee wrote in a note. Dell’s other major business, PC manufacturing, is facing higher memory chip costs as companies shift resources to building AI data centers.
However, the company has been able to cope with rising prices better than competitors such as HP Inc and China’s Lenovo Group.
The rising costs could hit Dell’s gaming PC business as memory processors are essential for video game systems, enabling fast load times, smooth frame rates and overall performance.
Market researcher TrendForce has upgraded its price growth rate for Dynamic Random Access Memory for the first quarter of 2026 to 90% to 95% from the previous quarter.
Dell’s shares have clearly outperformed those of HP and Lenovo over the past year.
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