Dell Technologies Inc.: F1Q27 Earnings Preview – It's A Tricky One

研报英文原文证据摘录

Dell Technologies Inc.: F1Q27 Earnings Preview – It's A Tricky One

IdeaMand (2) DELL facing greater margin headwinds. As a result, we remain Underweight-

rated, albeit with a new $170 price target, or 12x our new FY28 EPS of $14.13 (up

from $11.79 previously), with our new Bull Case valuation of $272 (17x FY28 EPS of

$16) and bear case valuation of $108 (9x FY28 EPS of $12) implying a -36% risk-

adjusted risk-reward from current prices.

What we've learned about DELL's traditional hardware performance over the

last 90 days, and what this should mean for April/July quarter fundamentals. In

the last 90 days, our checks on DELL's traditional hardware business have been

strong. Specifically, DELL has been/is currently a beneficiary of general-purpose

server demand resilience and large-enterprise pull-forward – materially

outperforming HPE in our checks – as customers prioritize mission-critical compute

refreshes and DELL benefits from both superior supply-chain execution and faster

time to market than peers. In PCs, IDC data show that DELL shipped 9.3M units in

C1Q, up 6% Y/Y, outperforming the PC market for the second consecutive quarter,

and outperforming our unit forecast by 5%, with pricing up strong double digits Y/Y

( Exhibit 1 ). Finally, on storage, our checks have been mixed, with DELL performance

still lagging peers in C1Q per our recent VAR call, but pointing to potential signs of

stability as DELL sales team refocus on storage sales and mid-market demand

recovers. When we take all of these factors into account, we expect DELL to report

non-AI server ISG and CSG April quarter revenue of $23.1B, 4% above consensus,

and guide to July-quarter traditional hardware revenue of $23.9B, 7% above Street,

which is where our estimates now reside.