Shares of Dell Technologies (DELL) rose on Thursday after Deutsche Bank re-initiated coverage on the company with a buy rating and a $62 one-year price target.
Shares of the Round Rock, Texas-based company gained 1.82% tot $54.38 in mid-morning trading on the New York Stock Exchange after Deutsche Bank analyst Jeriel Ong initiated his own coverage of the company.
In a research note to clients, Ong said that while Dell's IT infrastructure spend is likely to slow through 2019, concerns over the company's high debt levels are overdone, noting positive strides being made toward improving sales within its storage and VMware (VMW - Get Report) segments.
VMware is a Dell Technologies portfolio company.
Sweet on Dell Technologies: 1Q FY20 Financial Results - "I think they show us, we're on track." Learn more:https://t.co/Q2rIG7fytj— Dell (@Dell) June 18, 2019
Dell, which was taken private in 2013 and acquired a majority stake in the virtualization leader in 2016 through its $67 billion acquisition of storage giant EMC, went public again at the end of last year.
While a positive start, Ong's target price is nearly half of his predecessor. Karl Keirstead, who previously covered Dell for Deutsche Bank, initiated his own coverage of the company in February 2018, also with a buy rating.
However, his target price was $114 a share -- albeit for the same reasons as Ong: An oversold share price and promise of stronger growth in storage and virtualization.
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