Dell enters the S&P 100 as top shareholder Silver Lake sells

Dell Technologies joined the S&P 100 index at the market open on September 21, requiring index-tracking funds to purchase its shares near record levels. The stock closed at $568.06 on September 18, trading within roughly 5% of its intraday record high of $595.51 set during that same session, after Dell's market capitalization tripled over the past year.

While passive index funds entered as mandatory buyers, private equity firm Silver Lake, Dell's largest outside shareholder and a board member since the 2013 buyout, sold shares on multiple trading days through mid-September. Much of that selling occurred at prices above $540 per share.

At the Citi Global TMT Conference on September 10, CFO David Kennedy stated that enterprise clients are seeking to reserve infrastructure two to four years ahead. Dell holds a record $95 billion backlog reported on September 1. Kennedy noted that Dell reserves the right to adjust pricing as costs fluctuate, calling storage the company's margin lever after storage revenue grew 26% last quarter, adding approximately $2.5 billion in revenue while operating expenses fell to about 8% of revenue.

On Wall Street, RBC initiated coverage in September with an Outperform rating and a $640 price target, while JPMorgan maintains a target of $635. Consensus data compiled by TIKR shows an average target price near $577 and a Street high of $735. Dell is scheduled to report its next quarterly financial results on December 1.