Posted 12/17/2023, 1:00:00 PM
Super Micro Computer Stock Falls 25% Despite Strong Growth, Appears Undervalued Given AI Server Market Potential
- Super Micro Computer (SMCI) stock is down 25% from highs despite strong revenue growth of 37-48% and earnings growth of 109% last fiscal year
- The pullback seems unjustified - guidance was raised and the AI server market poised to grow rapidly
- SMCI has capacity to support $15-20B in revenue in next couple years as AI server market grows
- Stock trades at attractive valuations - 2x sales and forward P/E of just 7
- If SMCI hits $20B revenue target in 2-3 years, market cap could reach $40B, a 170% upside from current levels