The best AI infrastructure trade of 2026 could be a server maker. Dell Technologies (NYSE:DELL | DELL Price Prediction) trades at $490.81, up 293.52% year to date on record AI server orders. Our 24/7 Wall St. price target is $560.77, implying 14.25% upside over 12 months. We rate Dell a buy with 90% confidence.
| Metric | Value |
|---|---|
| Current Price | $490.81 |
| 24/7 Wall St. Price Target | $560.77 |
| Upside | 14.25% |
| Recommendation | BUY |
| Confidence Level | 90% |
A $24 Billion Quarter Reset the Narrative
Dell’s Q1 FY27 earnings on May 28, 2026 reframed the AI trade. Revenue hit $43.84 billion, up 87.54% YoY, with non-GAAP EPS of $4.86 beating consensus by nearly 64%.
AI-optimized server revenue reached $16.13 billion (+757% YoY), and management booked $24.4 billion in AI orders in a single quarter, exiting with a $51.3 billion AI backlog. The stock has climbed 19.12% in the past month and sits 2% from its 52-week high of $514.
The Case for $585 and Higher
Our bull scenario points to $585.31, or roughly 19% upside. Dell raised FY27 revenue to $165 to $169 billion and non-GAAP EPS to $17.90 at midpoint, up 74% YoY. CEO Jeff Clark said “demand continues to exceed supply” and framed customer conversations as “multi-year in nature. Think three, four, five years.”
ISG operating margin expanded to 10.5%, with agentic AI layering in as a fresh tailwind for traditional servers. 19 buy or strong buy ratings against zero sells show sell-side alignment with the bull view.
What Could Go Wrong
Our bear case lands at $422.16, a 14% drawdown. Q1 gross margin compressed to 17.8% from 21.1% YoY as low-margin AI servers dominate mix. Negative stockholders’ equity of -$1.4 billion and hyperscaler concentration pose real risks.
Operating income still grew 213.82% YoY, offsetting the mix shift. A beta of 1.4 means any AI capex pause would hit Dell harder than the market.
How Dell Stacks Up Against HPE and Super Micro
Hewlett Packard Enterprise (NYSE:HPE) is the closest enterprise server analog. HPE raised FY26 non-GAAP EPS guidance to $3.35 to $3.45 after posting Q2 revenue of $10.68 billion, up 40% YoY. HPE’s FY27 framework calls for 8% to 12% revenue growth, well below Dell’s 47% FY27 guide. Dell is scaling faster and returning more capital, supporting a premium.
Super Micro Computer (NASDAQ:SMCI) is the AI server pure play. SMCI guided FY27 revenue to $65 to $72 billion and trades at a P/E near 12.
The cheap multiple reflects margin instability (Q1 FY26 GAAP gross margin was 9.3%) and an ongoing board review tied to export-control matters. Dell’s diversified ISG and CSG mix earns its higher multiple. The peer set supports our $560.77 target as a reasonable read.
Dell Price Prediction 2026-2030
The 24/7 Wall St. price target of $560.77 is our high-conviction call, backed by 90% model confidence and a forward P/E of 27 that looks fair given 74% EPS growth guidance.
The bull thesis rests on hyperscaler AI capex holding through 2027 (Dell is one server maker inside that buildout, and we mapped seven other non-chip AI infrastructure names in a free report). The bear thesis kicks in if memory and GPU supply loosen in a way that cracks pricing power.
Extending the 24/7 Wall St. price target model forward, here is where Dell could trade assuming ISG growth normalizes and traditional server refresh cycles support the base.
| Year | 24/7 Wall St. Price Target |
|---|---|
| 2026 | $560 |
| 2027 | $625 |
| 2028 | $685 |
| 2029 | $730 |
| 2030 | $763 |
These projections assume Dell converts AI backlog to revenue and defends ISG operating margins. Significant upside or downside could result from hyperscaler AI capex trajectory or a sustained shift in GPU allocation away from Dell’s platforms.
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