Key Takeaways
- Bank of America increased Dell’s price projection to $246 (previously $205) and HPE’s to $38 (previously $32)
- Analyst Wamsi Mohan maintains Buy recommendations for both companies
- Agentic AI technology is creating heightened demand for CPU-heavy servers and storage systems
- Dell commands approximately 12% of AI server market revenue; HPE projected to reach $6.5B in AI server sales by 2026
- BofA analysts suggest their forecasts may underestimate the rapid growth of agentic AI adoption
Bank of America issued upgraded price projections for Dell Technologies and HP Enterprise this week, identifying the emergence of agentic AI technology as a significant driver behind strengthening demand across both specialized AI and conventional server equipment.
Wamsi Mohan, the firm’s analyst covering the sector, elevated Dell’s price objective to $246 from the previous $205 mark, while raising HPE’s target to $38 from $32. Both stocks maintain Buy ratings in the analyst’s coverage.
These target adjustments aren’t driven by generic enthusiasm around artificial intelligence. Instead, they reflect a fundamental transformation in how AI computational tasks are being executed.
Conventional AI inference operations represent isolated, single-step events. Agentic AI fundamentally changes this paradigm by converting individual requests into extended chains of interconnected steps, with each segment demanding its own inference operation. This architectural shift dramatically amplifies computational requirements for every task.
Bank of America characterized the transition this way: agentic AI “turns one discrete inferencing event into sequenced workflows, driving more inference events per task.” The result is substantially greater demand for AI-optimized servers, storage solutions, and the networking infrastructure linking these components together.
The critical factor here involves CPU utilization patterns. Since agentic workflows operate sequentially with interdependencies between stages, they place significantly greater stress on central processing units compared to traditional AI implementations. This dynamic directly benefits Dell and HPE’s established server operations, extending beyond their specialized AI product lines.
Dell’s Market Position in AI Infrastructure
Dell currently ranks among the top original equipment manufacturers in the AI server segment, capturing roughly 12% of aggregate AI server revenue. Bank of America estimates the complete AI server marketplace will reach $496 billion during 2026. Dell is simultaneously experiencing accelerating market share expansion among Neo Cloud service providers.
Regarding comprehensive infrastructure solution packages, BofA calculates Dell maintains an 11% OEM market share, positioning the company as one of the primary beneficiaries of expanding demand patterns.
Mohan’s $246 target incorporates an elevated valuation multiple, warranted by strengthening demand across both AI-specific server products and traditional computing platforms.
HPE’s Financial Projections
HPE is forecasted to deliver $6.5 billion in AI server revenue throughout 2026. The company holds a 9% OEM share within infrastructure solution stacks, another segment BofA highlights as a significant growth opportunity.
The revised $38 price target, increased from $32, incorporates BofA’s assessment that HPE’s conventional server operations will experience substantial momentum alongside its AI-dedicated offerings.
Bank of America explicitly acknowledged that its financial models “are likely conservative given the pickup in agentic AI demand.” This type of candid statement is uncommon from Wall Street analysts and indicates the firm perceives additional appreciation potential beyond current projections.
Dell’s stock declined 0.06% while HPE advanced 1.63% when the analyst note was released. Neither equity experienced substantial price movement that trading session, though the elevated targets position both companies prominently for investors monitoring AI infrastructure opportunities.
The revised price objectives were issued on April 27, 2026.
