Will Dell Kill Super Micro Computer Stock? These Analysts Worry the Answer May Be ‘Yes.’

Hardware companies such as Dell Technologies (DELL) and Super Micro Computer (SMCI) are part of the artificial intelligence (AI) megatrend. These two companies provide advanced computing infrastructure and solutions for AI workloads. 

Dell has partnered with Nvidia (NVDA) to build AI factories that train large-scale AI models. It also assembles most of the server racks for Elon Musk’s xAI, showcasing an ability to support large-scale models. 

Super Micro focuses on server designs in verticals such as AI and high-performance computing. Its portfolio of products includes GPU-optimized servers and liquid-colling solutions that are crucial to managing heat for supercomputers used to train AI models. It also has partnerships with Nvidia and xAI. 

So, let’s see which hardware stock between Dell and Super Micro Computer is a good investment right now. 

Mizuho Is Bullish on SMCI Stock

According to a report from TipRanks, Mizuho Securities analyst Vijay Rakesh has reinstated coverage of Super Micro Computer with a “Hold” rating and a $50 price target, suggesting 16.4% upside potential.

SMCI stock has been grappling with several regulatory issues in recent months. Last year, noted short seller Hindenburg Research targeted Super Micro and accused the company of accounting fraud. Soon after, SMCI’s auditor EY resigned, forcing the server maker to delay reporting its financial statements. 

Valued at a market capitalization of $24.6 billion, Super Micro stock trades 65% below its all-time high, allowing investors to buy the dip and benefit from outsized gains when market sentiment improves. 

Super Micro is positioned to grow its revenue from $14.9 billion in fiscal 2024 to as much as $40 billion in 2026. Comparatively, adjusted earnings are forecast to expand from $2.21 in 2024 to $4.50 in 2026. So, priced at 9.2 times forward earnings, the tech stock is relatively cheap. 

Out of the 13 analysts covering SMCI, two recommend “Strong Buy,” two recommend “Moderate Buy,” seven recommend “Hold,” and two recommend “Strong Sell.” The average target price for SMCI stock is $57.11, indicating upside potential of 40% from current levels. 

Is Dell Stock a Good Buy Right Now?

Dell Technologies delivered robust fourth-quarter results, with revenue up 7% to $23.9 billion, fueled primarily by strong Infrastructure Solutions Group (ISG) performance. It reported earnings per share of $2.68, an 18% increase year-over-year, outpacing revenue growth.

ISG revenue soared 22% to $11.4 billion, with servers and networking achieving a record $6.6 billion, up 37%. Storage revenue grew 5% to $4.7 billion, marking the second consecutive quarter of growth. ISG's operating income reached a record $2.1 billion, up 44%, with margins improving to 18.1%.

AI remains a significant growth driver for Dell, with Q4 AI orders reaching $1.7 billion and shipments totaling $2.1 billion. The company's AI backlog now stands at approximately $9 billion, reflecting strong partnerships with companies like xAI and continued enterprise adoption.

In the Client Solutions Group (CSG), revenue increased 1% to $11.9 billion, with commercial revenue up 5% to $10 billion, while consumer revenue declined 12%. Dell is anticipating a broader PC refresh cycle in 2025 as the installed base ages and AI PCs become more widely available.

For fiscal year 2026, Dell expects revenue between $101 billion and $105 billion, representing 8% growth at the midpoint. Comparatively, ISG sales are projected to grow in the high teens, driven by $15 billion in AI server shipments. 

Dell also announced an 18% increase in its annual dividend to $2.10 per share and a $10 billion increase in its share repurchase authorization, demonstrating confidence in future performance.

Priced at 11x forward earnings, DELL stock is reasonably valued. Out of the 20 analysts covering DELL, 15 recommend “Strong Buy,” two recommend “Moderate Buy,” and three recommend “Hold.” The average target price for DELL is $146.57, around 40% higher than the current trading price.