Dell stock dips as Piper sees a 'concerning to mixed' earnings setup

Investing.com -- Dell shares have edged lower premarket after Piper Sandler flagged a challenging outlook for the company amid rising component costs and mixed expectations for its upcoming earnings.

Piper Sandler said that while Dell has been “executing well, especially with AI-server,” the firm faces a “tougher setup than most with its ‘cost+’ model and rising component costs.”

The analyst team, led by James Fish, described the overall setup for Dell as “concerning to mixed” for calendar year 2026, noting that growth could accelerate to “>30% in the quarter / ~1-2% beat based on inputs,” but highlighted risks around gross and operating margins.

Piper Sandler added that FY27 revenue is expected to start at approximately $120 billion, with ongoing concerns about margin pressures.

The broader sector showed more positive signals. Piper Sandler said off-calendar checks were “relatively strong for Rubrik, Pure (record), Zoom, Nutanix, & Cisco,” while other names like IOT, NTNX, and RBRK were positioned for potential upside this year.

In data infrastructure, Dell partnerships with VMware and mid-market enterprises were cited as points of strength, though Piper Sandler noted that component costs and macro uncertainties could temper upside.

The firm also highlighted hardware pricing trends, noting that “DRAM M/M changes [have] slowed to start 2026, but NAND M/M prices have been accelerating through February so far.”

Despite the risks, Piper Sandler acknowledged some momentum, stating that Dell is “a vendor seeing net-positive momentum into CY26,” leaving the stock in a mixed position ahead of earnings.

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