Top Undervalued Tech Stocks Set for Major Rally
Not every stock in the technology sector carries an inflated price tag. Although the ongoing bull market has surged forward for over three years now, financial analysts are forecasting a potential moderation in 2026. This shift is expected as investors pivot away from pricey technology names toward more affordable opportunities in various other industries. That said, astute bargain hunters can still uncover compelling opportunities within the tech space itself.
Dell Technologies: A Leader in AI-Driven Growth
Dell Technologies stands out as a prominent name in the personal computer manufacturing arena, a foundation upon which the company was built. However, the true engine of its expansion lies elsewhere, particularly in the realm of networking and server solutions. Within this critical segment, Dell supplies essential servers tailored for artificial intelligence data centers, along with the vital networking hardware that interconnects these powerful systems.
Performance metrics underscore the robustness of this division. In the latest reported quarter, revenues from this area skyrocketed by 37% compared to the previous year. Looking at the cumulative figures for the first three quarters ending September 30, the growth reached an impressive 43%. This surge is propelled by what experts describe as an AI infrastructure supercycle—a phenomenon where the demand for AI-enabling hardware, such as advanced servers and networking gear, significantly exceeds available supply, creating a sustained tailwind for companies like Dell.
These favorable dynamics have translated into unprecedented achievements for the company. Dell reported all-time high total revenues and amassed a staggering backlog of $18.4 billion—representing secured contracts awaiting fulfillment. Demonstrating confidence in continued momentum, the company increased its AI server shipment projections by $150 million. Looking ahead, management anticipates fiscal 2026 to mark yet another record-breaking year, with AI server shipments forecasted at $25 billion—a remarkable leap exceeding 150% growth from the preceding fiscal period. Complementing this, Dell has also elevated its overall revenue outlook by 17%, signaling strong expectations for sustained expansion.
One of the most attractive aspects of investing in Dell Technologies at this juncture is its remarkably low valuation. The stock currently trades at a price-to-earnings multiple of 15, and even more enticingly, just 9 times forward earnings. When evaluated through the lens of its five-year price/earnings-to-growth ratio, the figure sits at a mere 0.46—a level well below 1.0, which is widely regarded as indicative of significant undervaluation, especially given the company’s promising long-term growth trajectory.
Wall Street professionals echo this optimism. The consensus median price target stands at $165.50 per share, implying a potential 41% appreciation from current levels. For value-conscious investors eyeing the tech sector, Dell Technologies presents a straightforward and compelling case for accumulation.
Broadridge Financial Solutions: Resilient Market Leader
Broadridge Financial Solutions has endured a sharp decline, with its share price dropping 22% so far this year, leaving many investors puzzled by the disconnect. Part of this pressure may stem from broader apprehensions surrounding the fintech landscape, including lofty valuations, the looming specter of artificial intelligence disruptions, an evolving regulatory framework fraught with uncertainty, and elevated borrowing costs amid persistent high interest rates.
Yet, for Broadridge, which dominates as the premier provider of proxy voting materials and investor communication services, many of these headwinds simply do not apply with the same intensity. Commanding an overwhelming 80% market share in investor communications, the company benefits from formidable barriers to entry. High switching costs for clients, coupled with the intricate operational challenges of transitioning providers, fortify its competitive moat, making it exceedingly difficult for rivals to encroach on its territory.
Moreover, Broadridge operates a recession-resistant business model. The demand for essential investor materials and communication services persists steadily across all market conditions, providing a stable revenue foundation. In its most recent quarter, concluding December 31, the company delivered a 10% year-over-year revenue increase, alongside a robust 21% rise in adjusted earnings. Building on this momentum, Broadridge has refined its full-year fiscal earnings guidance, now projecting growth between 9% and 12%.
Post-selloff, the stock’s valuation mirrors Dell’s attractiveness, changing hands at a modest 18 times earnings. A majority of Wall Street analysts—roughly two-thirds—recommend it as a buy, with the median price target pointing to a 41% upside over the coming 12 months. This combination of defensive qualities, proven growth, and discounted pricing positions Broadridge as a standout opportunity.
Both Dell Technologies and Broadridge Financial Solutions exemplify undervalued technology investments with substantial potential for bullish momentum throughout 2026. In a market where many tech names trade at premiums, these two stand ready to capitalize on their respective strengths—AI infrastructure demand for Dell and unassailable market dominance for Broadridge—potentially delivering outsized returns for patient investors.
Investors should note that while these stocks appear poised for gains, market conditions can shift rapidly. Dell’s exposure to the AI boom offers high-reward potential but also ties its fortunes to the pace of technological adoption and data center expansions. Broadridge’s stability stems from its essential services role, yet it remains sensitive to broader financial sector trends and regulatory changes. Nonetheless, their current valuations, coupled with strong fundamentals and analyst backing, make them noteworthy candidates for portfolios seeking tech exposure without the froth.
