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Investors should consider taking profits in Dell Technologies (DELL) following its explosive year-to-date rally, says Evan Lee, a senior GF Securities analyst. In a research note this morning, Lee lowered his price target on DELL to $403, signaling potential downside of roughly 12% from current levels. 

Dell stock has been a lucrative investment in 2026, currently trading at more than 3.5x its price at the start of this year. 

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While DELL currently serves as a major supplier for SpaceX (SPCX) and the sole provider for CoreWeave (CRWV), competitors are rapidly encroaching on its territory ahead of Nvidia's (NVDA) upcoming Rubin platform.

According to the GF Securities analyst, Super Micro (SMCI) will likely "capture a larger share" of SPCX's next gigawatt-scale data center in Texas. 

Meanwhile, Nvidia's Taiwanese partner Quanta Computer is emerging as a second source for CRWV, expected to secure up to a 30% share in 2027. 

These competitive pressures are bearish for Dell shares as they could weaken the giant's long-term positioning within Nvidia's platform ecosystem, potentially capping its NVL72 rack shipments at around 15,000 units annually across FY27 and FY28, Lee warned.  

Beyond competitive pressures, valuation remains a central concern for GF Securities. 

Following its meteoric run in 2026, DELL shares are trading at a forward price-to-earnings (P/E) multiple of nearly 23x, which makes it infinitely more expensive to own than peer SMCI. 

In his report, Lee admitted that Dell will report a blowout quarter and raise guidance on Sept. 3, but said that upside is baked into the stock price already.  

Consensus is for the artificial intelligence (AI) server specialist to record $4.65 a share of earnings (EPS) for its second quarter, which would represent an exciting 121% growth on a year-over-year basis. 

Investors should note, however, that other Wall Street firms do not agree with GF Securities on DELL stock.

According to Barchart, the consensus rating on Dell Technologies remains at "Moderate Buy," with the mean price target of about $507 indicating potential upside of another 8% from current levels. 

On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com