Dell Technologies reported a 16.4% year-to-date stock gain as of now, significantly outperforming the S&P 500, which fell 1.8%, and the Zacks Computer – Micro Computers industry. This momentum is attributed to the growing demand for AI infrastructure, with Dell securing over $64 billion in AI-optimized server orders and shipping more than $25 billion worth of AI infrastructure in fiscal 2026. The fiscal fourth quarter alone saw $34.1 billion in AI orders with $9.5 billion in shipments, amidst a record backlog of $43 billion.
Dell’s strong financial position is noteworthy, ending fiscal 2026 with $13.3 billion in cash and investments while generating over $11 billion in operating cash flow. The company’s robust cash flow has supported $7.5 billion in shareholder returns through dividends and share repurchases. Looking ahead, Dell anticipates AI server revenues to reach approximately $50 billion in fiscal 2027, indicative of over 100% year-over-year growth.
Currently trading at a forward P/E ratio of 11.39X, Dell’s shares are considered undervalued compared to the industry average of 28.09X, suggesting potential for further appreciation as it leverages strong AI infrastructure demand and maintains financial flexibility.
