Dell Technologies Inc. (DELL): Hedge Funds' Cheap Tech Stock Pick?

In the dynamic world of technology stocks, Dell Technologies Inc. (DELL) has been a subject of interest among hedge funds, with recent changes in their holdings sparking curiosity about the company's investment potential. This article explores whether DELL is the best cheap technology stock to buy according to hedge funds.




Dell Technologies, a leading global technology company, has seen a mix of increased and decreased hedge fund holdings over the past year. Notable changes include:


* Susan M. Herendeen of ESL Trust Services, LLC initiating a new position with 100% of her portfolio invested in DELL.
* Zhiwei Zhang of Pinpoint Asset Management Ltd reducing his holdings by 92.8%.
* Charles Davidson of Wexford Capital LP, Ken Fisher of Fisher Asset Management LLC, and Richard Pzena of Pzena Investment Management LLC also reducing their holdings, though to a lesser extent.




The trading activities of top hedge fund managers can influence overall sentiment towards DELL stock. For instance, Louis Moore Bacon, Luis Stuhlberger, John Hurley, Michael Rockefeller, and Andrew Alkon all sold out of their DELL holdings, indicating a bearish sentiment. However, the increased holdings by Susan M. Herendeen suggest a bullish outlook.


Key catalysts that could drive a change in hedge fund sentiment for DELL in the near future include:


1. Strong financial performance: DELL's recent first quarter fiscal 2025 financial results, with revenue up 6% year over year, indicate a positive outlook.
2. Growth in Infrastructure Solutions Group (ISG) and Client Solutions Group (CSG): DELL's ISG revenue grew 22% year over year, with record servers and networking revenue, while CSG revenue remained flat.
3. Strategic acquisitions and partnerships: DELL's acquisition of EMC in 2016 and its partnership with VMware have strengthened its position in the tech industry.




The current valuation of DELL stock, with a P/E ratio of around 10, is lower than its peers, making it an attractive investment opportunity. Hedge funds may be drawn to DELL's relatively low valuation and strong financial performance, indicating a potential undervalued asset.


In conclusion, Dell Technologies Inc. (DELL) presents an interesting case for hedge funds seeking a cheap technology stock. With a mix of increased and decreased holdings, the overall sentiment remains uncertain. However, strong financial performance, growth in key segments, and strategic acquisitions could drive a more bullish outlook among hedge funds in the near future.