Jim Cramer Explains Why “Buyers Flocked in” for Dell (DELL)

Jim Cramer Explains Why “Buyers Flocked in” for Dell (DELL)

Syeda Seirut Javed

Mon, September 7, 2026 at 8:41 PM GMT+3 4 min read

• DELL +1.50%
• NVDA +0.84%

During the September 2 episode of Mad Money, Jim Cramer turned his attention to Dell Technologies Inc. (NYSE:DELL), breaking down why buyers flocked to the stock following its earnings report as investors favored lower-multiple technology names. He commented:

What's going on right now is that big money managers are fleeing stocks with high price to earnings multiples wherever they're found and they're too risky. Instead, they're rushing into, say Dell, which sells for less than 20 times earnings. Dell reported a great quarter last night, and when the smoke cleared, we saw that it could earn $25 per share. That's a terrific low-multiple price check. Buyers flocked in. That's why the stock closed at $492, up 16%. The buyers aren't fleeing from the data center or tech in general. They're just fearful of high multiple tech stocks. data center or not because they have to be perfect…

NVIDIA's Jensen Huang knows that the companies using his chips are starting to make a ton of money so why not back them up? This is something I asked Dell's CFO last night. He confirmed that right here on this show. Companies are relying on NVIDIA's equipment and they're making fortunes. We're finally at the moment where customers are beginning to clean up from this technology. That's why Dell's up so much. They told you that they're very good at supply chain management. Some of that supply chain management is about getting enough NVIDIA because those chips are in short supply. Dell's multiple is low because people didn't believe they could make as much money with NVIDIA's wares. Last night, we found out, and look what happened.

You can also read Cramer comments about the company when he discussed it on September 1 as he called Dell's (DELL) quarter one of the best he has ever seen.

Valuation Power and Supply Chain Execution

Dell Technologies Inc. (NYSE:DELL) sells for around 21x forward earnings at the time of writing and with a projected profit of nearly $25 per share, it trades on par with the S&P 500. The company's earnings power gives investors some margin of support, which explains why the stock jumped 16% after earnings came out. In addition, supply chain execution makes all the difference. Securing steady shipments of NVIDIA chips is a challenge in the data center business right now. Dell uses its massive scale to lock down those scarce components and ship them out smoothly, letting enterprise clients turn heavy compute spending into actual, revenue-generating power right away.

Potential Counter-Arguments and Risks

It could be argued that traditional hardware vendors remain hostage to cyclical replacement schedules and low-margin manufacturing dynamics. Market participants might worry that once initial data center buildouts stabilize, server providers could face severe pricing pressure, component commoditization, and margin compression. Furthermore, supplier concentration also remains a risk, meaning any shift in semiconductor allocation or partner priorities could challenge future earnings visibility.

Institutional Sentiment and Short Interest

According to Insider Monkey data, 77 hedge funds had a stake in Dell Technologies Inc. (NYSE:DELL) in Q2 compared to 72 in the prior period, showing increasing hedge fund backing. Moreover, the short % of float sits at 4.64, which highlights lack of aggressive bearish conviction against the company.

Great market value often hides behind low valuation multiples. By matching a $25 per share earnings potential with strong supply chain management, Dell Technologies Inc. (NYSE:DELL) is shaking off old doubts about traditional hardware. With a P/E ratio sitting around 21 and massive demand rolling in, the company is positioning itself as one of the leaders in the ongoing data center buildout.

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READ NEXT: Jim Cramer Explains Why Palantir's Rule of 40 Dominance Proves Bears Wrong and Jim Cramer Breaks Down the Enterprise Software Rebound for Salesforce (CRM) and Veeva (VEEV).

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