Key Takeaways
- Bank of America increased Dell’s stock price target to $246 (previously $205) and HPE’s to $38 (previously $32)
- Analyst Wamsi Mohan maintains Buy ratings for both technology stocks
- Agentic AI technology is creating unprecedented demand for CPU-heavy servers and storage systems
- Dell commands approximately 12% of AI server revenue market; HPE projected to reach $6.5B in AI server sales by 2026
- BofA acknowledges its forecasting models may underestimate the rapid growth of agentic AI adoption
Bank of America announced increased price targets for Dell Technologies and HP Enterprise this Monday, pointing to agentic AI as the primary driver behind strengthening demand across both AI-focused and conventional server hardware segments.
Wamsi Mohan, the firm’s analyst, raised Dell’s price objective to $246 from $205 while elevating HPE’s target to $38 from $32, maintaining Buy recommendations on both companies.
These target revisions aren’t based on broad AI enthusiasm. Instead, they reflect a fundamental transformation in AI workload architecture.
Conventional AI inference operates as an isolated event. Agentic AI, however, converts a single query into multiple sequential operations, with each step requiring independent inference processing. This architectural difference significantly amplifies computational requirements for each individual task.
BofA characterized this evolution as follows: agentic AI “turns one discrete inferencing event into sequenced workflows, driving more inference events per task.” The result is heightened demand for AI-capable servers, storage solutions, and the networking infrastructure binding them together.
The critical factor involves CPU utilization. Since agentic workflows operate sequentially with interdependent processes, they impose greater demands on CPUs compared to conventional AI applications. This dynamic directly benefits Dell and HPE’s traditional server operations, extending beyond their specialized AI product lines.
Dell’s AI Server Market Standing
Dell ranks among the premier OEMs in the AI server space, capturing roughly 12% of aggregate AI server revenue. BofA estimates the complete AI server marketplace at $496 billion for 2026. Dell is also experiencing accelerated market share expansion with Neo Cloud service providers.
Regarding infrastructure solution stacks, BofA calculates Dell holds an 11% OEM market share, positioning it among the primary beneficiaries as demand intensifies.
Mohan’s $246 target incorporates a premium valuation multiple, warranted by expanding demand spanning both AI server platforms and traditional computing infrastructure.
HPE’s Revenue Projections
HPE is forecast to achieve $6.5 billion in AI server revenue during 2026. The company maintains a 9% OEM share in infrastructure solution stacks, another segment BofA identifies as experiencing growth.
The revised $38 price target, elevated from $32, demonstrates BofA’s perspective that HPE’s conventional server operations receive substantial momentum alongside its AI-dedicated offerings.
BofA explicitly stated that its financial models “are likely conservative given the pickup in agentic AI demand.” Such candid acknowledgment is uncommon, implying the analyst perceives potential for additional upward movement.
Dell stock declined 0.06% while HPE advanced 1.63% when the research note was published. Neither equity experienced significant volatility that trading session, though the elevated targets position both companies prominently for investors monitoring AI infrastructure opportunities.
The price target adjustments were released on April 27, 2026.
