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Morgan Stanley Raises Dell (DELL) PT to $110 Amid AI Growth, Margin Uncertainty

Dell Technologies Inc. (NYSE:DELL) is one of the best AI stocks to invest in according to billionaires. On February 27, Morgan Stanley increased its price target for Dell Technologies to $110 from $101, while maintaining an Underweight rating. Although Dell’s FY2027 EPS guidance exceeded the firm’s previous estimates by 28%, the firm expressed difficulty in projecting simultaneous growth in pricing, demand, and margins during a significant memory cycle.

A day earlier, Dell Technologies reported financial results for FY2026, with full-year revenue reaching $113.5 billion, which was a 19% increase year-over-year. FQ4 was particularly strong, with revenue jumping 39% to $33.4 billion. This performance was driven by the Infrastructure Solutions Group, which saw quarterly revenue surge 73% to $19.6 billion. A primary catalyst for this growth was the demand for AI-optimized servers, which generated $9.0 billion in quarterly revenue, a 342% increase. Additionally, full-year diluted EPS rose 36% to $8.68, while non-GAAP diluted EPS reached $10.30.

Sergiy Palamarchuk/Shutterstock.com

For FY2027, Dell Technologies Inc. (NYSE:DELL) expects the full-year revenue to reach ~$140 billion, representing 23% growth. The company anticipates AI-optimized server revenue to double to ~$50 billion for the year. For FQ1 2027, revenue is projected between $34.7 billion and $35.7 billion, which would be a 51% increase year-over-year. Management expects this momentum to continue driving significant value, targeting non-GAAP diluted EPS of $12.90 at the midpoint for the full year.

Dell Technologies Inc. (NYSE:DELL) designs, develops, manufactures, markets, sells, and supports various comprehensive and integrated solutions, products, and services internationally. The company has two segments: Infrastructure Solutions Group and Client Solutions Group.

While we acknowledge the risk and potential of DELL as an investment, our conviction lies in the belief that some 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 and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

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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.

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  • 140 Metas
  • 84 Googles
  • 65 Microsofts
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  • 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.

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