By Peet Serfontein & Zimele Mbanjwa
Dell Technologies Inc. is a multinational technology company specialising in the development, manufacturing, and sale of computers, software, and IT infrastructure solutions, serving a wide range of consumers from individual users to large enterprises. Dell's product offerings include personal computers, servers, storage solutions, and networking equipment, with a strong emphasis on cloud-based and edge computing solutions.
In recent years, Dell has focused on expanding its presence in high-growth areas such as hybrid cloud, artificial intelligence (AI), and cybersecurity, aligning with trends in digital transformation and enterprise IT modernisation. Dell maintains a solid market position within the highly competitive tech sector in the US.
Technically, the price appears to be in wave 5 of the Elliott wave cycle (see the numbering 1 to 5 on the chart). This supports a bullish case as Wave 5 is typically viewed as the final upward wave of a five-wave impulse pattern, often regarded as a continuation of bullish sentiment. Wave 5 completes the overall bullish cycle, driven by strong momentum, often reflecting heightened enthusiasm or optimism in the market. As Wave 5 progresses, the price may push into new high territory. As it breaks into previously unexplored price zones, the price may create new resistance and support levels.
The stock is building a base around its 200-day simple moving average (SMA), supporting a bullish tone (see the insert).
Emerging upside momentum, according to the MACD indicator as well as upwards movement of the On-balance Volume indicator, also offers support.
Share Information
| Share Code | DELL US |
|---|---|
| Industry | Technology Hardware & Equipment |
| Market Capital (USD) | 87.49 billion |
| One Year Total Return | 82.87% |
| Return Year-to-Date | 64.15% |
| Current Price (USD) | 123.63 |
| 52 Week High (USD) | 179.70 |
| 52 Week Low (USD) | 66.75 |
| Financial Year End | February |
| Over the past 12 months, the company's share price has achieved strong double-digit growth as it benefitted from the structural AI tailwinds. | |
Consensus expectations
(Bloomberg)
| FY24 | FY25E | FY26E | FY27E | |
|---|---|---|---|---|
| Headline Earnings per Share (USD) | 7.13 | 7.88 | 9.34 | 10.61 |
| Growth (%) | 10.58 | 18.42 | 13.67 | |
| Dividend Per Share (USD) | 1.48 | 1.74 | 1.95 | 2.07 |
| Growth (%) | 17.70 | 11.94 | 5.95 | |
| Forward PE (times) | 15.68 | 13.24 | 11.65 | |
| Forward Dividend Yield (%) | 1.41 | 1.58 | 1.67 | |
| The group's earnings growth is expected to accelerate in FY26, perhaps as PC demand recovers. Stabilisation is expected later on in the lower-to-mid teens. | ||||
Buy/Sell Rationale
Technical Analysis:
Fundamental view:
| Share Name and Position | KHC US - Stop loss (Close the position) |
C US - Buy (Continue to hold) |
WM US - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 35.72 | 61.71 | 209.09 |
| Current | 33.73 | 64.17 | 215.85 |
| Movement | -5.6% | +4.0% | +3.2% |
| The trade breached our stop loss level, and we closed the position. |
A price at a confluence of the 200-day, 200-week and 200-month SMAs remains of interest. Remains above its 200-day SMA and fading downside momentum is supportive.
Our profit target is $71.00 with a trailing stop-loss at $60.50. Exit the trade by 3 January 2025. |
A price that gave a second "buy" signal since 2022 according to the Bollinger Bands remains of interest. Remains above its 200-day SMA and upside momentum is supportive.
Our profit target is $227.00, with a trailing stop-loss at $208.60. Exit the trade by 27 December 2024. |
| Share Name and Position | DIS US (Continue to hold) |
ABNB US (Continue to hold) |
ABSI US - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 94.05 | 132.5 | 3.79 |
| Current | 96.2 | 134.79 | 3.84 |
| Movement | +2.3% | +1.7% | +1.3% |
|
The price generally appreciates between October and May. Remains below its 200-day simple moving average (regarded as a counter-trend strategy). Upside price momentum is supportive.
Our profit target is $105, with a trailing stop-loss at $19.90. Exit the trade by 23 April 2024. |
A price in a developing upward channel pattern remains of interest. Remains just below its 200-day simple moving average (regarded as a counter-trend strategy). Upside price momentum is supportive.
Our profit target is $153, with a trailing stop-loss at $126.40. Exit the trade by 11 December 2024. |
A developing inverted head and shoulders pattern remains of interest. Remains below its 200-day simple moving average (SMA). Subdued downside momentum is supportive.
Our profit target is $5.50, with a trailing stop-loss at $3.15. Note recommended exit trade date of 7 November 2024. |
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