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Analyst Increases Dell (DELL) Price Target, Says Nvidia’s Blackwell GPUs Critical for Growth

We recently published a list of 10 AI Stocks to Watch on Latest News and Analyst Ratings. In this article, we are going to take a look at where Dell Tech Inc (NYSE:DELL)  stands against other AI stocks to watch on latest news and analyst ratings.

AI discussion boards online are buzzing with a new development where tech experts are pointing to a possible plateauing of performance in artificial intelligence applications.

CNBC’s Deirdre Bosa in a latest program quoted tech investor Ben Horowitz, who said in a recent podcast that he’s not seeing performance improvement despite increasing GPUs.

“We’re increasing GPUs at the same rate, but we’re not getting the intelligence improvements at all out of it.”

OpenAI is reportedly facing similar problems with its upcoming AI model.

“The Information reports that the quality increase in OpenAI’s upcoming advanced model, Orion, is smaller than the jump seen between the last two flagship models, GPT-3 and GPT-4. In other words, generational advancements may have peaked as the models are essentially running out of data to train on,” Bosa said.

While the next jump in AI performance is far away in the future, the possibilities this technology has unlocked based on the existing data and resources are keeping investors and Wall Street analysts busy.

READ ALSO: Jim Cramer’s Latest Lightning Round: 11 Stocks to Watch and Jim Cramer on AMD and Other Stocks.

In this article we take a look at top AI stocks trending on the back of latest news and analyst ratings. With each stock we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A laptop

Dell Tech Inc (NYSE:DELL)

Number of Hedge Fund Investors: 88

Dell Tech Inc (NYSE:DELL) shares recently rose after Morgan Stanley analyst Erik Woodring increased his price target on the stock citing server sales. Woodring now projects Dell Tech Inc (NYSE:DELL)’s AI server revenue will reach about $20 billion by fiscal 2026, a 56% increase over previous forecasts, which could bring earnings per share up to $10.50—roughly 12% above current Wall Street estimates.

Woodring attributes Dell Tech Inc (NYSE:DELL)’s momentum in the AI server market to steady demand from clients, growing market share, and substantial repeat orders from large Tier-2 cloud providers, including Tesla, xAI, and CoreWeave. In addition to corporate demand, Woodring highlighted rising interest from sovereign funds in the Middle East and U.S. government entities.

While some shipping details for fiscal 2026 and calendar 2025 remain uncertain, Woodring noted Dell Tech Inc (NYSE:DELL)’s solid positioning in the AI server market. Early 2025 is expected to bring the initial delivery of Nvidia’s Blackwell GPUs, which he sees as crucial to Dell Tech Inc (NYSE:DELL)’s sustained growth in AI servers.

The analyst increased his price target on Dell Tech Inc (NYSE:DELL) to $154 from $136.

Dell Tech Inc (NYSE:DELL) boasts a diverse revenue base, with around half generated in the U.S. and the rest from international markets. Of this, the Client Solutions Group (CSG) — responsible for PCs, monitors, and workstations — contributes 55%. However, CSG’s revenue has faced recent challenges, with a 5.5% decline in 2023 and another 12% year-over-year drop in Q2.

Dell Tech Inc (NYSE:DELL)’s Infrastructure Solutions Group (ISG) generates 38% of global revenue and is positioned to capitalize on AI advancements. ISG, already a leader in external RAID storage, could find fresh growth opportunities across data storage, AI servers, and cloud services, with its AI segment having an estimated 18% CAGR total addressable market until 2027, largely driven by AI services. Sales of Dell’s PowerEdge XE 9680 server, a key product, rose by 23% year-over-year in Q2.

With free cash flow projected to reach $7.67 billion by January 2025 and EPS estimated to grow from $7.13 to $9.38, the market may be slow to fully recognize these fundamental improvements despite a 75% year-to-date stock increase. Dell Tech Inc (NYSE:DELL) currently trades at a P/E non-GAAP trailing twelve months of 18x and a forward P/E of 16.6x, which are respectively 25% and 30% below the sector median. Its price-to-sales ratio of 1x also stands out against the sector’s 3x median, while its price-to-FCF at 12x remains well below the sector’s 21x, a 44% discount.

Carillon Scout Mid Cap Fund stated the following regarding Dell Technologies Inc. (NYSE:DELL) in its Q2 2024 investor letter:

“Dell Technologies Inc. (NYSE:DELL) was a top contributor despite reporting disappointing first-quarter earnings results, because investors looked through the near-term disappointment and expected strong growth from AI-related servers and personal computers. We expect Dell to participate in the growth of artificial intelligence hardware, especially as enterprises invest more aggressively. We like the company’s depth and breadth of products and services, as well as its focus on keeping costs low.”

Overall, DELL ranks 7th on our list of AI stocks to watch on latest news and analyst ratings. While we acknowledge the potential of DELL, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DELL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. This article is originally published at Insider Monkey.

AI Fire Sale: Insider Monkey’s #1 AI Stock Pick Is On A Steep Discount

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

The whispers are turning into roars.

Artificial intelligence isn’t science fiction anymore.

It’s the revolution reshaping every industry on the planet.

From driverless cars to medical breakthroughs, AI is on the cusp of a global explosion, and savvy investors stand to reap the rewards.

Here’s why this is the prime moment to jump on the AI bandwagon:

Exponential Growth on the Horizon: Forget linear growth – AI is poised for a hockey stick trajectory.

Imagine every sector, from healthcare to finance, infused with superhuman intelligence.

We’re talking disease prediction, hyper-personalized marketing, and automated logistics that streamline everything.

This isn’t a maybe – it’s an inevitability.

Early investors will be the ones positioned to ride the wave of this technological tsunami.

Ground Floor Opportunity: Remember the early days of the internet?

Those who saw the potential of tech giants back then are sitting pretty today.

AI is at a similar inflection point.

We’re not talking about established players – we’re talking about nimble startups with groundbreaking ideas and the potential to become the next Google or Amazon.

This is your chance to get in before the rockets take off!

Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

AI is the ultimate disruptor, and it’s shaking the foundations of traditional industries.

The companies that embrace AI will thrive, while the dinosaurs clinging to outdated methods will be left in the dust.

As an investor, you want to be on the side of the winners, and AI is the winning ticket.

The Talent Pool is Overflowing: The world’s brightest minds are flocking to AI.

From computer scientists to mathematicians, the next generation of innovators is pouring its energy into this field.

This influx of talent guarantees a constant stream of groundbreaking ideas and rapid advancements.

By investing in AI, you’re essentially backing the future.

The future is powered by artificial intelligence, and the time to invest is NOW.

Don’t be a spectator in this technological revolution.

Dive into the AI gold rush and watch your portfolio soar alongside the brightest minds of our generation.

This isn’t just about making money – it’s about being part of the future.

So, buckle up and get ready for the ride of your investment life!

Act Now and Unlock a Potential 10,000% Return: This AI Stock is a Diamond in the Rough (But Our Help is Key!)

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Our research team has identified a hidden gem – an AI company with cutting-edge technology, massive potential, and a current stock price that screams opportunity.

This company boasts the most advanced technology in the AI sector, putting them leagues ahead of competitors.

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This is the #1 Gold Stock for your 2025 watch list

Brace yourself.

There’s no question that thanks to Washington’s disastrous policies – and out-of-control spending – the outlook for the U.S. economy now appears dire.

And with the U.S. national debt now rising by a staggering $1 trillion every 100 days…there are no easy solutions to help get the nation back on track.

While Jay Powell and the Biden-Harris White House sweat out a federal debt that has reached $35.5 trillion – and climbing – many investors have raced to the sidelines with their cash.

But the truly savvy investors laugh while Jay Powell frets, because they understand that this ridiculous spending has also triggered a nearly unprecedented bull market for gold.

Just look at this chart for the yellow metal.

After testing the $2,000/ounce mark in August 2020 and February 2022, gold traded down to near $1,600/ounce in October 2022.

Since then, gold prices have been on an absolute tear and currently sit above $2,600/ounce, a $1,000/oz increase in just two short years.

But the surge in gold prices that we’ve seen over the past few years could pale in comparison to what’s on the horizon. As shocking as it may sound, with no end in sight for the Fed’s money printing, we could see the price of gold increase by many multiples in the years ahead.

With soaring inflation, the dollar stands to lose more and more of its value, which means you’ll need a lot more dollars to buy gold.

According to legendary investor Peter Schiff, today’s seemingly-high gold price of $2,600/oz. “could soar to $26,000/oz. — or even $100,000/oz. There’s no limit because gold isn’t changing — it’s the value of the dollar that’s decreasing.”[i]

Meanwhile, as profitable as gold has been, select gold mining stocks have really kicked into high gear, handing investors even bigger profits.

Click to continue reading…