Owning NVDA is the preferred strategy for AI exposure due to superior business quality and durable cash flow resilience against potential market slowdowns.

I'll explain how Dell is benefiting from the broader AI data center buildout, and how they basically have a tight partnership now with Nvidia. And as long as Nvidia keeps growing, so will Dell.

So, today I'm going to tell the story of how Dell became a growth stock in 2026, and how by some metrics, it might be cheaper than Nvidia.

The other important thing to know about with Dell is that they have much lower margins compared to a company like Nvidia. Nvidia has 72% gross margins and 50% net margins.

I'm going to explain how the PC company is now getting in the business of enabling AI factories and how Dell is actually making money on Nvidia. And there's kind of a partnership forming there.

And how there is similar uncertainty in the 5-to-10-year view, similar to how when you look at Nvidia.

And you'll notice that's basically in line with Nvidia's projected revenue growth and guidance they just gave. And that's the interesting thing with Dell being a growth stock here.

If you're like me and you think Nvidia is going to keep growing in the next year to three years, Dell is going to benefit in that exact same demand because Dell is building out Nvidia's infrastructure.

It's Nvidia's chips and AI factories that Dell is selling. And for the full year adjusted earnings per share, they're guiding $25.50, which is up 150% year over year. So that's higher earnings per share growth than Nvidia.

And given that Dell is coming from a smaller market cap base, if it does actually just benefit from Nvidia's overall growth, that might end up meaning more for Dell stock given it's a smaller company because of the raw dollar amounts that Nvidia is dealing with.

Well, in some cases, they're not needed like when Nvidia is selling to the hyperscalers like Amazon Web Services, Microsoft with Microsoft Azure, Google with Google Cloud. They're not really needed in that kind of scenario.

And even SpaceX and xAI works with Dell. So Dell takes the Nvidia systems, whether it's Blackwell, whether it's the new Vera Rubin that is rolling out, and they basically build some customer solutions on top of that.

So, Dell is the number one rack-scale infrastructure provider. They were the first to ship their Rubin systems from Nvidia. And they have a large existing business in the mainstream server market.

So, Dell's partnership with Nvidia here gives them a large opportunity for growth. But, there are some more things you need to understand that could actually be cons related to Dell's stock.

First off, they don't have the same margin as companies like Nvidia. They are more of a middle man here. They're an integrator. Currently, they have a mid-single-digit operating margin on AI servers.

Now, whether there's an overbuild 5 to 10 years from now, I have no idea. So, although Dell had a large customer base they're referencing, in terms of the dollar amounts, most of it's being driven by a few companies.

And all of these companies are in the Nvidia ecosystem. CoreWeave builds on Nvidia. XAI and SpaceX just announced that they're going to be exclusive to Nvidia on chips.

But as you zoom out, it's not Dell that is driving all of this. It's Nvidia. Nvidia is the one driving the entire AI buildout. It's their So, Nvidia's business, as I mentioned, they sell to the hyperscalers, but then they also sell to the AI clouds, industrial, and enterprise segment.

That's their second largest segment. It's even growing faster than the hyperscaler side.

If you go back and watch my Nvidia video from last week, where I dove into that, Nvidia's main business is the data center. It's split between hyperscalers, and now that's AI cloud industrial enterprise segment.

And Nvidia's basically saying that in the long run that segment will be bigger than their hyperscaler segment.

This was part of what I liked about Nvidia in that they're the ones generating a ton of free cash flow right now to where the money is going.

But personally, I think the best play in the AI build out is actually just owning Nvidia. And Nvidia pretty much trades at the same PE multiple as a company like Dell.

Nvidia is a 5 trillion dollar company. Nvidia is going to generate hundreds of billions of dollars of free cash flow in the coming years. So ultimately, my plan in my portfolio is just to own Nvidia.

I think it keeps it way more simple. It's the better business. It will have more durable cash flows even in an environment where the compute shortage ends, the AI build out slows, perhaps even to get into an overbuild.