2024-07-17 08:00:00 ET
Summary
- Shares of Super Micro Computer have outperformed this year, but have seen a negative trend since mid-March as early year gains have consolidated.
- Earnings growth expectations for AI stocks have dipped, perhaps impacting SMCI's stock performance, with the firm's earnings on tap in early August.
- I see SMCI's valuation as fair, but seasonality is bearish, and industry competition may pressure margins in the future.
- I highlight key price levels to monitor ahead of the Q4 report.
Super Micro Computer has been the poster-child AI superstar in the past year, at least aside from NVIDIA (NVDA). Shares are up 209% so far this year, besting the 154% performance in NVDA. But those gains all came in the first, call it, 50 trading days of the year. Since mid-March, the stock has been negative. That’s not to say it has been a disappointment, after all, some consolidation in price action is generally healthy for the durability of a long-term trend. ...
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Super Micro Computer: Another Big EPS Quarter Expected, AI Fervor Levels Off (Rating Downgrade)