Dell Earnings Could Swing the Stock 11% This Week, a $52 Straddle Shows

Dell Technologies reports fiscal second quarter results Tuesday after the close, and the options market is braced for a large reaction. Contracts expiring September 4 imply a swing of roughly 11% in either direction.

The at-the-money straddle, a paired call and put at the same strike, cost about $52 against Dell's $456.01 close on Monday. Buyers profit only if the stock travels further.

What Dell Guided For, and What Analysts Expect

Dell guided to revenue of $44 billion to $45 billion for the quarter, adjusted earnings of about $4.80 a share, and roughly $15.5 billion of AI server revenue. It expected its Infrastructure Solutions Group, the server and storage division, to grow about 75%.

Zacks Investment Research puts the consensus at $4.72 a share across five forecasts. Dell earned $2.10 in the year-ago quarter.

The bar is high because the previous quarter reset it. Revenue reached $43.8 billion in Dell's record first quarter beat, up 88% year over year, and adjusted earnings of $4.86 landed far above Wall Street's estimate.

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