Why Is Dell Technologies Stock Falling Monday?

Dell Technologies Inc. (NYSE:DELL) stock fell nearly 4% in Monday’s premarket session as a selloff in AI-linked stocks weighed on the broader technology sector.

Nasdaq futures dropped 1.70%, while S&P 500 futures fell 0.79%.

AI Spending Concerns Pressure Dell

Dell shares came under pressure as investors reassessed the outlook for artificial intelligence infrastructure spending.

The Financial Times reported that investors are concerned calls to slow AI development could eventually translate into lower infrastructure and capital spending. Memory and semiconductor stocks were among the hardest hit as traders reconsidered future demand for AI hardware.

Those concerns intensified after Anthropic CEO Dario Amodei called for leading AI companies to work together on managing the technology’s development and safety. OpenAI CEO Sam Altman and SpaceX (NASDAQ:SPCX) CEO Elon Musk supported the effort, according to the Financial Times.

The debate has implications for companies such as Dell, which has benefited from strong demand for AI servers and related data center infrastructure.

Barclays strategist Emmanuel Cau said a greater focus on AI safety could raise questions about the pace of capital spending. Investors are also weighing what slower investment could mean for global growth and corporate earnings.

Against that backdrop, Dell’s recent rally leaves the stock more exposed to profit-taking as investors reduce risk across AI-linked names.

Technical Analysis

Dell remains in a strong long-term uptrend despite Monday’s premarket decline.

The stock is about 14% above its 20-day simple moving average of $479.37. It is also 108.7% above its 200-day SMA of $261.76.

The 20-day SMA remains above the 50-day SMA of $448.90. That keeps the near-term trend bullish. However, the wide gap between Dell’s share price and its longer-term averages could leave the stock vulnerable to consolidation or a deeper pullback.

Momentum also remains positive. The MACD is above its signal line, while the histogram is positive. That suggests selling pressure has eased compared with the previous downswing.

Dell also formed a golden cross in March, when its 50-day SMA moved above its 200-day SMA. That signal continues to support the longer-term bullish trend.

Critical Levels: The 52-week high of $567.75 is the key resistance level. The 20-day SMA near $479.37 could provide support if the pullback deepens.

Analyst Outlook

Dell trades at about 33 times earnings, reflecting a premium valuation. The stock has a Buy consensus rating and an average price forecast of $580.81.

RBC Capital initiated coverage with an Outperform rating and a $640 price forecast on Sept. 10. Evercore ISI maintained an Outperform rating and raised its forecast to $650 on Sept. 9. Citigroup maintained a Buy rating and lifted its forecast to $600 on Sept. 2.

Benzinga Edge Rankings

Dell has a Benzinga Edge Momentum score of 99.55, reflecting strong relative price performance. However, its Value score stands at 23.13, pointing to a relatively expensive valuation.

Its Growth score of 55.29 is more neutral.

Overall, Dell’s Edge rankings point to a momentum-driven stock with a premium valuation. If AI infrastructure concerns persist, investors may focus on whether Dell can hold support near its short-term moving averages.

Top ETF Exposure

Dell carries a 6.14% weighting in the Tortoise AI Infrastructure ETF (NYSE:TCAI) and a 4.88% weighting in the American Customer Satisfaction ETF (BATS:ACSI).

The GraniteShares 2x Long DELL Daily ETF (NASDAQ:DLLL), a leveraged single-stock ETF, has 66.65% exposure to Dell.

Price Action

DELL Stock Price Activity: Dell Technologies shares were down 3.66% at $546.50 during premarket trading on Monday, according to Benzinga Pro data.

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