Dell Stock Has Nearly Quadrupled in 2026. Is It Too Late to Buy?

Dell Technologies (DELL) has nearly quadrupled in 2026, so the obvious question is whether it is already too late to buy. The rally is backed by real fundamentals, with artificial intelligence (AI) server demand and earnings estimates rising sharply.

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The catch is that expectations have moved just as fast. The Texas-headquartered technology company now trades at a much richer multiple, while Wall Street expects unusually strong earnings per share (EPS) growth for years. I still like the underlying AI story, but I think it may be too late to chase the stock here. The current valuation leaves much less room for any slowdown in growth or execution, which keeps me neutral for now.

Wall Street Was Way Behind Dell’s Earnings Power

Wall Street was way behind the curve on Dell’s earnings power. Of all S&P 500 (SPX) companies, only SanDisk (SNDK) has outperformed Dell so far in 2026. Dell has gained more than 290% year-to-date. That even beats hyped AI memory names such as Micron (MU).

The biggest driver, in my view, was how badly analysts underestimated Dell’s earnings power. That was especially clear heading into its Q1 report in early June. Nearly half of Dell’s 290% year-to-date gain has come since then.

For example, in February, Dell projected FY27 revenue of around $140 billion. It also guided for $50 billion in AI server revenue and $12.90 in adjusted EPS. Just three months later, after Q1, those figures jumped to $167 billion, $60 billion, and $17.90, respectively. That is, Dell raised its EPS outlook by nearly 39% in a single quarter.

It wasn’t simply management becoming more optimistic. Q1 completely shattered expectations. Revenue came in at $43.8 billion versus roughly $35.7 billion expected. Adjusted EPS reached $4.86 versus the prior estimate of $2.96. Dell also recognized $16.1 billion in AI server revenue and received $24.4 billion in AI orders in that quarter alone.

Dell Is No Longer Just a PC Company

Dell is no longer viewed as just a “boring PC company.” It is now seen as one of the leading players in AI infrastructure. When a stock becomes a nearly four-bagger in less than a year, there is usually more going on than hype.

The market initially had reasons to be skeptical. AI servers can generate huge revenue, but they also rely heavily on Nvidia (NVDA), which captures much of the economics. That can leave Dell with fairly tight margins. What changed was Dell showing that the AI boom was actually reaching the bottom line.

In Q1, Dell’s Infrastructure Solutions Group (ISG) posted $29 billion in revenue, up 181% year-over-year.

ISG’s operating income grew even faster, jumping 206% to $3.06 billion. The segment’s margin rose from 9.7% to 10.5%. It wasn’t just AI servers. Traditional servers grew 92%, storage rose 8%, and commercial PCs increased 18%.

That margin expansion changed how the market views Dell. The company is capturing more than just graphics processing unit (GPU) server sales. ISG revenue jumped from $10.3 billion to $29 billion, while many operating costs grew far more slowly. On a consolidated basis, non-GAAP OpEx fell 610 basis points as a share of revenue, to just 8.4% — Dell’s lowest level in more than 20 years.

Valuation Looks More Reasonable on Growth

Dell’s valuation looks more reasonable once growth is factored in. Over the past three years, its long-term EPS growth estimate — covering the next three to five years — has averaged about 13.96% annually. Earlier this year, the market was still pricing in roughly 13.8% growth. Yet after Q1, that estimate jumped to 26.35%, before recently easing to around 25.7%.

Putting that growth estimate against Dell’s FY27 forward earnings multiple gives the stock a forward PEG ratio of almost 1.04. In other words, Dell does not look particularly expensive once its stronger expected earnings growth is considered. A PEG around 1 generally means the earnings multiple is roughly in line with the company’s expected growth rate.

How Feasible Is It for Dell to Sustain Its Long-Term EPS Growth?

The big question, then, is how feasible that 25.7% long-term EPS growth estimate really is. Dell itself is not guiding anywhere close to that. Its long-term framework calls for 7%–9% annual revenue growth and over 15% non-GAAP EPS growth — including 11%–14% growth in ISG and just 2%–3% in CSG (its consumer segment). So Wall Street is currently underwriting something materially stronger than Dell’s own targets.

Revenue alone will not get DELL there. FY27 is an extraordinary year, with Dell guiding for $167 billion in revenue, up 47%, including $60 billion from AI servers. However, Dell’s long-term revenue target is only 7%–9%. Even at the top of that range, a lot of the remaining EPS growth would need to come from margin expansion and buybacks, just as some of the easy operating leverage starts becoming harder to repeat.

The strongest argument for that margin upside is not AI servers themselves, but what Dell can attach to them. AI servers still carry relatively thin margins, but Dell is increasingly selling higher-margin storage, services, networking, and financing alongside those deployments.

Buybacks, however, are becoming much less powerful. Dell spent roughly $1.6 billion repurchasing 11 million shares in FQ1 at an average price of $147. At around $480, the same amount would retire only about 3.3 million shares, roughly 70% fewer.

So a 25.7% EPS CAGR is not impossible. Yet sustaining it for three to five years increasingly requires strong revenue growth, continued mix-driven margin expansion, and much more from the underlying business rather than financial engineering — buybacks.

Is DELL a Buy, According to Wall Street Analysts?

The consensus on Wall Street for DELL is a Moderate Buy. Of the 20 ratings issued over the past three months, 14 are Buy and six are Hold. However, the DELL forecast suggests that analysts see the stock as fully valued. The average Dell price target is $470.94, implying about 4.13% downside from the current price.

Probably Too Late to Chase Dell

So, is it too late to buy Dell? I think the answer is probably yes, at least for now. The AI story is real, earnings power has improved sharply, and the business deserves a higher multiple than it did before.

However, after a nearly 4x run, a lot of that good news is already priced in. With long-term EPS expectations now very demanding and buybacks becoming less accretive, the margin for error looks much thinner. That keeps me neutral on DELL at current levels.