Dell Cuts Price Target by 10% to $135 as Memory Costs Rise
Analysts are split as Dell navigates record-high memory costs while BofA retains a Buy rating, cutting its price target from $150 to $135 and lowering FY27 EPS estimate by $0.86 to $10.00. Dell is testing DRAM chips from ChangXin Memory Technologies to diversify suppliers and ease margin pressure.
1. Memory cost pressures
Dell faces record-high memory costs that threaten near-term profitability and margin performance, driven by global DRAM shortages pushing chip prices upward.
2. BofA revises forecasts
Bank of America maintains a Buy rating but lowers its price target from $150 to $135 and trims FY27 EPS estimate by $0.86 to $10.00, reflecting cost uncertainties.
3. ChangXin partnership
Dell is collaborating with China’s ChangXin Memory Technologies to test DRAM chips, aiming to diversify its supplier base and reduce dependence on pricier vendors.
4. Margin and valuation outlook
These strategic moves may ease margin pressure and support valuation stability, but sustained high memory costs could still limit profitability gains in upcoming quarters.