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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.

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.

READ NEXT: 12 Unstoppable Dividend Stocks to Buy According to Analysts and Dividend Champions, Contenders and Challengers list: 15 Highest Yielding Stocks.

Disclosure: None. Follow Insider Monkey on Google News.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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