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Dell Technologies DELL shares are cheap, as suggested by a Value Score of B.
The DELL stock is trading at a significant discount with a forward 12-month P/E of 11.51X compared with the Computer and Technology sector’s 23.15X.
P/E Ratio (Forward 12 Months)
Image Source: Zacks Investment Research
However, DELL’s shares have plunged 18.3% in the year-to-date period, underperforming the Zacks Computer and Technology sector’s decrease of 11.2% and the Zacks Computer - Micro Computers industry’s decline of 16%.
YTD DELL Stock Price Performance
Image Source: Zacks Investment Research
The recent drop in the share price is largely due to broader market weakness. Investor sentiment has soured amid rising trade tension, with additional tariffs raising fears of escalating costs. It is also suffering from continuing weakness in the consumer segment of the PC market. Cautious spending by enterprises and large customers on PCs and storage IT has been a concern for DELL’s investors.
Can DELL recover from its recent share price decline despite the broader market weakness and sector challenges?
DELL Benefits From Surging Demand for AI Servers
Despite the broader market weakness and sector challenges, Dell Technologies is benefiting from strong demand for artificial intelligence (AI) servers, driven by ongoing digital transformation and heightened interest in generative AI applications. Its PowerEdge XE9680L AI-optimized server is very much in demand. Strong enterprise demand for AI-optimized servers is aiding Dell Technologies.
In the fourth quarter of fiscal 2025, DELL’s AI-optimized server momentum saw an increase of $1.7 billion in orders. The company shipped $2.1 billion worth of AI servers in the fiscal fourth quarter, and the AI server backlog remained healthy at $4.1 billion.
Building on this momentum, in April 2025, DELL introduced advancements in its server, storage, and data protection portfolios to help organizations modernize data centers and address the growing demands of AI, cybersecurity, and workload scalability.
Dell PowerEdge also supports the NVIDIA NVDA Blackwell Ultra platform, including the upcoming NVIDIA HGX B300 NVL16, NVIDIA GB300 NVL72 and NVIDIA RTX PRO 6000 Blackwell Server Edition.
DELL Benefits From Expanding Clientele
DELL is benefiting from an expanding partner base that includes NVIDIA, Worley, Microsoft, Meta Platforms META, Advanced Micro Devices AMD and Imbue.
Dell Technologies is expanding the Dell AI Factory portfolio with new AI PCs, infrastructure, software and services, strengthening its footprint among enterprises. In March 2025, Dell Technologies and NVIDIA expanded their AI Factory collaboration, introducing new AI PCs, infrastructure, software, and services to accelerate enterprise AI adoption across various scales.
Dell Technologies collaborated with Meta Platforms to make it easy for its customers to deploy the latter’s Llama 2 models on-premises with Dell Technologies’ AI-optimized portfolio.
In February 2025, Dell Technologies expanded its AI for Telecom program through a collaboration with Advanced Micro Devices to develop AI solutions that enhance real-time telecom network monitoring and management using Dell PowerEdge XE7745 servers powered by Advanced Micro Devices EPYC processors.