Should Projected AI Server Demand and EPS Growth Require Action From Dell (DELL) Investors?

• Bank of America recently projected that Dell Technologies' earnings per share could nearly double by 2030, highlighting increased demand for enterprise and sovereign AI infrastructure as well as expanding AI server deployments and a rebound in cloud-related capital expenditures as main drivers.
• An interesting point from this outlook is Dell’s potential to benefit directly from broader trends in AI and cloud infrastructure, underpinned by analyst confidence in stronger operating profit and cash flow over the coming decade.
• We'll examine how expectations of rising AI server demand enrich Dell Technologies' investment narrative and long-term growth prospects.

The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 20 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement.

Dell Technologies Investment Narrative Recap

For someone considering Dell Technologies as an investment, belief in the company's ability to outpace industry shifts, especially the momentum in AI infrastructure and cloud spending, is essential. The recent Bank of America outlook, projecting nearly doubled earnings per share by 2030, adds weight to the idea that a rebound in enterprise tech spending and AI server demand could boost Dell’s growth prospects. However, while this reinforces optimism around AI as a catalyst, competitive pricing pressures in Dell’s Client Solutions Group and persistent softness in consumer demand remain key short-term risks; the new forecast doesn’t materially reduce these concerns.

The company’s upcoming quarterly dividend, payable to shareholders of record as of July 22, 2025, is particularly relevant in context, signaling continued confidence in cash flow and commitment to shareholder returns even as Dell invests in growth areas like AI servers. For income-oriented investors, this dividend consistency may seem reassuring, yet it does not directly address the vulnerability to margin compression in a fiercely price-competitive PC market.

Conversely, investors should pay close attention to ongoing pressure on gross margins in Dell's Client Solutions Group, as this could...

Read the full narrative on Dell Technologies (it's free!)

Dell Technologies' outlook anticipates $116.0 billion in revenue and $7.0 billion in earnings by 2028. This implies a 6.2% annual revenue growth and a $2.4 billion increase in earnings from $4.6 billion currently.

Uncover how Dell Technologies' forecasts yield a $137.58 fair value, a 8% upside to its current price.

Exploring Other Perspectives

Eighteen private investors in the Simply Wall St Community sized Dell’s fair value between US$102.13 and US$173.93 per share. With future AI server demand flagged as a major catalyst, there is room for a wide range of opinions on Dell’s performance drivers, explore these viewpoints for fresh perspectives on what could move the stock next.

Explore 18 other fair value estimates on Dell Technologies - why the stock might be worth 20% less than the current price!

Build Your Own Dell Technologies Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Dell Technologies research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Dell Technologies research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Dell Technologies' overall financial health at a glance.

Searching For A Fresh Perspective?

Opportunities like this don't last. These are today's most promising picks. Check them out now:

• AI is about to change healthcare. These 26 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early.
• We've found 17 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.
• The end of cancer? These 25 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com