Dell: Get Paid To Bid Lower For This Overheated But High-Quality AI Server Play

Summary:

  • Dell Technologies has had a volatile year, with a 140% rally followed by a 50% selloff in the stock. Where do things stand now?
  • The AI server opportunity appears robust, but shares still appear a tad hot, and we’d like to own it from lower.
  • We propose selling $90 strike put options. This would maximize returns while affording us the opportunity to buy it at a better entry point.
  • Selling this put option could yield ~15.5% annualized (3.4% over the next 81 days).
  • We rate DELL a ‘Hold’.

AI symbol with speech bubbles

J Studios

Dell Technologies (NYSE:DELL) has had one hell of a year.

From the start of 2024 through mid-May, DELL’s stock skyrocketed roughly 140% from the mid $70’s to just shy of $180 per share, in one of the most epic runs of the


Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in DELL over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.


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