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Dell Technologies (NYSE:DELL) got a lift, Tuesday, as its shares climbed 2% in early trading after Evercore analyst Amit Daryanani raised his rating on the computing company to outperform from in line.
Daryanani said he raised his rating on Dell (DELL) due to several factors, including what he called the company’s “very conservative” forecast for its 2023 fiscal year. In February, Dell (DELL) said that for its first quarter, it expects to earn between $1.25 and $1.50 a share, on revenue of $24.5 billion and $25.7 billion. However, Daryanani said that there is evidence Dell (DELL) will be able to surpass those forecasts due to “share gains across [Dell’s] PC and infrastructure segments,” as well as a recovery in the high-end storage market.
Daryanani said a key factor to keep in mind regarding Dell (DELL) will be how the high-end storage market reacts to IBM’s (NYSE:IBM) next cycle of new mainframe computers.
“Depending on [the] timing of [IBM’s] mainframe launch, Dell (DELL) tends to see strong sequential growth for two to three quarters in high-end storage following a new [product] launch,” Daryanani said.
Additionally, Daryanani set a price target of $60 a share on Dell’s (DELL) stock.
It’s been a rough year on Wall Street for Dell (DELL). The company’s shares have fallen more than 12% since January, and Dell (DELL) didn’t do itself any favors with its latest earnings results that fell short of analysts’ estimates.
