Dell Shares Rebound Monday as Barclays Downgrades to Neutral

Dell Technologies shares rose on Monday, recovering some ground after last week's AI-driven selloff.

Dell Technologies shares are trending upward. What is driving DELL stock higher?

Dell Bounces Back from AI Selloff

After a tough week, investors are buying Dell again. Concerns about an AI bubble had hit stocks that benefited most from the boom, with Dell falling more than 11% on Wednesday alone. The AI stock bubble index tracking this risk currently reads 74, already at elevated levels and nearing extreme territory.

Several prominent analysts have said rising interest rates and bond yields could soon pop the bubble. These warnings came after leaked revenue data from Anthropic and OpenAI fell short of expectations. A bubble burst would likely hit hardware vendors the hardest.

Barclays Downgrades Dell to Neutral

On Wednesday last week, Barclays analyst Tim Long downgraded Dell from Overweight to Neutral and cut the price target from $603 to $574. Long's main concern is valuation. Dell shares have surged over 300% in 2026, and Long believes the stock is now expensive. Long also questioned whether AI-adopting enterprises will invest enough in additional hardware to sustain Dell's strong growth.

Long suggested that rising memory prices better explain recent revenue growth than a broad shift toward enterprise AI. Barclays said the AI server business is healthy but expects Dell's overall growth to slow over the next two years.

Michael Dell Sees AI Demand Outpacing Supply

CEO Michael Dell holds a more optimistic view. In a CNBC interview last week, Dell said customer demand for AI computing power exceeds the industry's supply capacity, and the CEO expects this gap to persist through 2030. Dell also acknowledged uncertainty in such long-term forecasts.

Dell further noted that new chip factory construction has long lead times, taking about four years to build, while AI technology is evolving rapidly.

DELL Stock Is Climbing

DELL stock movement: As of Monday's writing, Dell shares were up 0.89% at $455.75.