IT Hardware Sector Weakness Drives Morgan Stanley’s Dell Technologies Inc. (DELL) Downgrade

Dell Technologies Inc. (NYSE:DELL) is among the 20 Best Investments in 2026.

IT Hardware Sector Weakness Drives Morgan Stanley's Dell Technologies Inc. (DELL) Downgrade

Dell Technologies Inc. (NYSE:DELL) is on our list of best investment stocks.

TheFly reported on February 18 that Morgan Stanley reduced its price target on DELL  from $111 to $101and gave it an Underweight rating. The firm anticipates a solid, though not exceptional, performance for the January quarter and upcoming April guidance from off-cycle hardware coverage, including Dell, HP Enterprise, HP Inc., NetApp, and Pure Storage. Despite these expectations, the firm is reinforcing its cautious outlook based on prior experiences in the IT hardware sector.

In other news, on February 17, McLaren Racing and Dell Technologies Inc. (NYSE:DELL) announced the extension of their multi-year relationship, which had started in 2018. DELL continues to supply cutting-edge AI infrastructure, servers, and PCs as McLaren’s Official Innovation Partner, supporting every facet of the team’s operations from trackside performance and race strategy to car design and engineering.

Every race weekend, McLaren uses the Dell AI Factory to crunch massive amounts of data, run fast simulations, and employ digital twins to optimize performance in real time. In addition to helping the team make data-driven decisions, encourage innovation, and maintain a competitive edge on the Formula 1 circuit, this collaboration has been mainly responsible for McLaren’s success, which includes back-to-back Constructors’ Championships in 2024 and 2025.

Dell Technologies Inc. (NYSE:DELL) provides IT hardware, software, and services, including servers, storage, networking, and cloud solutions, enabling businesses and consumers to build, manage, and secure digital infrastructures efficiently.

While we acknowledge the potential of DELL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than DELL and that has a 100x upside potential, check out our report about the cheapest AI stock.

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