Bank of America has increased price targets for both Dell and Sandisk following Asia-focused supply-chain checks that the firm characterized as revealing "very robust" demand for AI servers.
Analyst Wamsi Mohan reported that the firm’s channel checks point to continuing strength in AI-server demand. Most of the near-term revenue is expected to be driven by systems based on GB300 processors, and the bank also anticipates additional VR-rack shipments in the second half of the year.
On Dell, BofA said it came away favorably, noting that the company’s fiscal 2027 AI-server revenue guide of $50 billion "could end up conservative." The bank raised its Dell AI-server revenue forecast for the first quarter to $15 billion, up from a prior estimate of $13 billion, and lifted its full-year AI-server projection to $60 billion from $50 billion. Alongside those changes, BofA raised its price target for Dell to $172 from $155.
Sandisk also received a higher valuation target after the bank pointed to a "strong NAND outlook" and tightening supply conditions. BofA observed that NAND pricing "continues to be strong" and that customers are increasingly seeking long-term agreements. The bank now models a 63% quarter-over-quarter increase in average selling price for the March quarter and raised its June-quarter ASP growth forecast to 20%. Sandisk’s price target was raised to $900 from $850.
The research note highlighted additional supply dynamics beyond NAND. BofA flagged persistent global tightness in optical fiber, while noting that PC demand remains mixed. The firm cautioned that pull-forward buying tied to rising memory prices could leave the second half of the year weaker, and that there is potential for "incremental downside" to industry PC demand.
Implications and market context
BofA’s checks in Asia suggest that AI infrastructure demand is a near-term revenue driver for server vendors, and that NAND vendors are benefiting from firm pricing and contract demand. The combination of strong AI-server orders and constrained component supply underpinned the bank’s decision to lift revenue and price targets for the two companies covered in the note.
At the same time, the bank’s note emphasizes risk from demand timing - specifically the possibility that accelerated purchases prompted by rising memory prices could depress later-period demand, particularly in the second half of the year, and weigh on PC industry volumes.
Investors and market participants will likely watch upcoming quarterly results and order patterns closely for confirmation of the trends BofA described, including GB300-based system shipments, VR-rack deliveries, NAND ASP movements, and any signs of easing or worsening supply tightness in optical fiber.