11:31 AM EDT, 10/03/2025 (MT Newswires) -- Dell Technologies ( DELL ) is expected to strike a confident tone at its Analyst Day next week and outline a strong financial model with double-digit earnings growth over the next three years, while addressing concerns about profit margins around artificial intelligence servers, UBS said in a note Thursday.

At its Oct. 7 Analyst Day, Dell is expected to note that while gross margins will vary depending on AI server revenue mix, operating margin from AI revenue should remain healthy, at around 5% to 6%, especially when including services and support that are sold alongside the hardware, analysts said.

"Nevertheless, we expect the debate to weigh on sentiment and Dell's valuation metrics," UBS said. "As such, we leave our target multiple unchanged at 15x despite expectations for strong revenue and EPS growth over the next three years."

The firm said it expects Dell to highlight a long-term annual revenue target of 6% to 8%, double its previous model, on rising AI server demand. Management is expected to raise ISG revenue growth target while reiterating its growth forecast for the CSG segment.

UBS has a buy rating and a $155 price target on Dell.

Shares of Dell were down more than 1% in recent trading Friday.

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