Dell Technologies' (DELL) results should sustain above long-term targets amid enterprise demand for AI investments, compute modernization, storage expansion, and PC refresh, RBC Capital Markets said in a Thursday research report.

The company's portfolio spanning compute, PCs, storage and servers, alongside its install base and flexible consumption options, positions it for continued market share gains, analysts wrote.

The brokerage said it views the operating environment as supply-constrained, primarily because of memory constraints, rather than demand-limited, and expects meaningful backlog to persist through fiscal 2027, providing visibility into the next fiscal year, according to the note.

A richer mix, better attach rates, and the completion by year-end of the transition to Dell's proprietary storage products could help the company's Infrastructure Solutions Group sustain or even expand operating margins within its 10% to 14% framework, according to RBC.

The brokerage said it initiated coverage of the stock with an outperform rating and a price target of $640 per share.

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