Super Micro Surges 20% as AI Server Demand Fuels Growth
• Super Micro Computer (SMCI) stock has surged 20% in 2024 so far due to bullishness around AI and demand for AI chips.
• SMCI provides modular servers optimized for AI, a fast-growing market expected to hit $150B by 2027. Over half of revenue is from AI servers.
• SMCI is quick to release new products for latest AI chips like Nvidia’s H200 and GH200, putting it in prime position to capitalize on AI server growth.
• SMCI expects 49% revenue growth in fiscal 2024 to $10-11B. Consensus earnings growth estimate is 46%. Continued rapid growth expected.
• Despite huge growth, SMCI trades at just 2.6x sales and a PEG ratio of 0.94, suggesting it's still undervalued. The stock may not stay cheap for long.