Dell Technologies Inc.: Michael Dell Buys When Stock Falls, Says Jim Cramer

Dell Technologies' stock has dropped 25% in April and 8.9% in August due to concerns about AI demand and tariff exposure. However, Jim Cramer believes the dip is not something to worry about and notes that Michael Dell buys the stock when it falls. Despite this, AI stocks with higher returns and limited downside risk are preferred.

Dell Technologies' stock has experienced a significant decline in recent months, dropping 25% in April and 8.9% in August. These drops have been attributed to concerns about artificial intelligence (AI) demand and exposure to tariffs. The company's stock fell 11% at the open on July 2, 2025, marking the largest single-day decline since April [2]. This decline was driven by several factors, including underwhelming third-quarter earnings per share (EPS) guidance and a notable decrease in AI server orders.

Jim Cramer, a prominent financial analyst, has expressed that the recent dip in Dell's stock is not a cause for concern. He noted that Michael Dell, the company's founder and CEO, has a history of buying the stock when it falls. However, Cramer also mentioned that AI stocks with higher returns and limited downside risk are preferred.

Despite the recent declines, Dell's stock has shown resilience. The company's second-quarter fiscal 2026 results exceeded market expectations, with revenue and profit both surpassing analyst estimates. The primary reasons for the after-hours trading session decline were the underwhelming third-quarter EPS guidance, a quarter-on-quarter drop in AI server orders, and infrastructure concerns [2].

The stock market's reaction to Dell's earnings report and AI concerns has been mixed. While some analysts believe the dip is a buying opportunity, others are cautious about the potential impact of tariffs and AI demand uncertainty on the company's future performance. As the market braces for what has historically been the weakest month for US shares, investors are advised to stay vigilant and monitor the company's progress closely.

References:
[1] https://www.mercurynews.com/2025/08/29/stocks-hit-by-tech-selloff-after-economic-reports-markets-wrap/
[2] https://www.ainvest.com/news/dell-shares-fall-11-open-april-2508/