2024-03-19 15:09:19 ET
Summary
- Dell Technologies Inc. is experiencing a sequential improvement in their ISG and CSG segments, with a growing backlog driven by demand for AI infrastructure.
- Management remains optimistic about the demand for AI-enabling infrastructure as enterprises seek to enhance their own data centers for AI applications.
- I anticipate storage, networking, and device sales to follow improving server growth as enterprises seek to optimize and debottleneck their IT infrastructure.
Dell Technologies Inc. ( DELL ) reported a sequential improvement across their ISG and CSG segments, with AI infrastructure building backlog. In tandem with other IT infrastructure manufacturers, Dell is experiencing a challenging networking equipment market as CIOs focus on cost-savings initiatives across their respective IT departments. I believe this can lead to a strong tailwind in the back-half of eFY25 through eFY26 as CIOs will seek to implement AI/ML applications for performance optimization, leading to the need for more storage capacity and higher networking speeds. Given my growth expectations, I provide DELL shares a BUY recommendation with a price target of $134.82/share....
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Dell Has Untapped Upside Risk