Bank of America raises price targets for Dell Technologies and SanDisk due to "very strong" AI server demand

Investing.com - Bank of America has raised the target prices for Dell Technologies and Sandisk after surveying the Asian supply chain, stating that AI server demand is “very strong.”

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Analyst Wamsi Mohan said that the survey shows “AI server demand remains robust,” with most recent revenue coming from systems based on GB300, and more VR rack shipments expected in the second half of the year.

The firm has a positive outlook on Dell Technologies, stating that its $50 billion AI server revenue guidance for fiscal 2027 “may ultimately be conservative.”

Bank of America currently forecasts Dell Technologies’ first-quarter AI server revenue to reach $15 billion, up from the previous guidance of $13 billion, and has raised the full-year AI server revenue forecast from $50 billion to $60 billion. Dell Technologies’ target price has been raised from $155 to $172.

Sandisk’s valuation target has also been raised, with Bank of America citing “strong NAND prospects” and tightening supply as reasons.

The firm notes that NAND pricing “remains strong,” and customers are increasingly seeking to sign long-term agreements.

The firm currently expects the average selling price (ASP) for the March quarter to grow 63% quarter-over-quarter, and has raised the June quarter forecast to a 20% increase. Sandisk’s target price has been raised from $850 to $900.

The report also emphasizes that global fiber optic supply remains tight, despite mixed PC demand. Bank of America warns that pre-purchasing related to rising memory prices could lead to a slowdown in the second half, and industry PC demand may face “additional downward pressure.”

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