Dell Technologies (DELL) is expected to deliver a strong beat in fiscal Q2 and raise its fiscal 2027 outlook on Sept. 1, BofA Securities said in a report Monday.

"We expect focus to be on magnitude of AI server demand vs supply, the durability of ISS strength, and whether storage

growth is beginning to show more visible AI pull-through," the report said.

For fiscal 2027, Dell is expected to raise its revenue guidance to $171 billion to $175 billion and EPS to about $18.90, with upside limited by availability rather than demand, the note said.

AI server revenue is expected to reach $15.6 billion in fiscal Q2, while backlog is projected at $60.6 billion, compared with $51.3 billion in Q1, the report said.

"For AI servers, we see another constructive setup given the scale of backlog, continued order activity, and visibility into multi-quarter deployments," the note said.

BofA raised its price target to $505 from $500 while keeping its buy rating on the stock.

Price: 461.72, Change: +5.47, Percent Change: +1.20