JPMorgan lowered the firm’s price target on Dell Technologies (DELL) to $150 from $160 and keeps an Overweight rating on the shares. The firm says artificial intelligence server as a theme, at least for U.S.-branded server companies, has fallen out of favor with investors. There are concerns around increasing margin pressure with advanced AI compute configurations limiting opportunity for increase in value-add relative to higher prices of the system, and a more intense competitive landscape with investors concerned about pricing for the industry as well as market share for Dell and Supermicro (SMCI), which benefitted as early leaders, following recently ramped portfolio offerings from HP Enterprise (HPE) and Lenovo, the analyst tells investors in a research note. JPMorgan continues to prefer Dell shares over HP Enterprise and Supermicro.
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