Super Micro Computer Stock Falls Hard After Nearly 200% Surge in Price: What Investors Need to Know

It’s been a thrilling start to 2024 for investors of Super Micro Computer (SMCI), as the stock has skyrocketed 191% through the first month and a half of the year. However, it looks like the stock’s win streak has come to an end after last Friday’s reversal.

All eyes are on Super Micro Computer as there is hope it can cash in on the AI craze alongside companies like Nvidia (NVDA) or Advanced Micro Devices (AMD), which has led to an even more impressive trend over the past year or so for SMCI – it’s up 757% since this time last year.

Part of what separates this company from others in the space, though, is its commitment to leading the charge on innovation. As much as half the company’s headcount is dedicated to research and development. 

This engineering-first mentality is appealing from a sustainability standpoint, as many analysts see nothing but upside in silicon diversity and overall data-center complexity. 

Another compelling case to bet on this company is its liquid-cooling offerings. As AI workloads continue to demand heavier power requirements, this competitive advantage is impossible to ignore.

At this time, liquid cooling deployments are merely a drop in the bucket for Super Micro. That being said, the company believes this will evolve rapidly going forward. As many as 205 data center customers have already expressed the need for this technology.

But what does this mean, exactly? A big boost to profits could be on the horizon. Super Micro could raise its average selling price as high as 20% for these offerings compared to the standard air-cooled systems.

Still, it’s fair to question whether there is still upside potential for a stock that sat at less than $90 this time last year. SMCI now sits at $815/share. So, where does this leave investors or prospective traders interested in the stock?

We’ve dug deeper into SMCI through the VectorVest stock forecasting software and found 3 things you’re going to want to see before you do anything else today.

Despite Falling 20%, SMCI is Still a Buy With Excellent Upside Potential, Safety, and Timing

VectorVest simplifies your trading strategy by giving you clear, actionable insights in 3 ratings. These are relative value (RV), relative safety (RS), and relative timing (RT). Each sits on its own scale of 0.00-2.00 with 1.00 being the average, allowing for quick and easy interpretation.

This saves you time and stress while empowering you to win more trades - but it gets even better. The system also offers a buy, sell, or hold recommendation for any given stock at any given time based on its overall VST rating. As for SMCI, here’s what we found:

• Excellent Upside Potential: The RV rating compares a stock’s long-term price appreciation (forecasted 3 years out) to AAA corporate bond rates and risk. It offers a much better look at a stock’s upside potential than a simple comparison of price to value alone. SMCI has an excellent RV rating of 1.51.
• Excellent Safety: The RS rating is a risk indicator. It’s derived from an analysis of the company’s financial consistency & predictability, debt-to-equity ratio, business longevity, sales volume, price volatility, and other factors. SMCI has an excellent RS rating of 1.44.
• Excellent Timing: The RT rating is based on the direction, dynamics, and magnitude of a stock’s price movement day over day, week over week, quarter over quarter, and year over year. Despite the abrupt turnaround, SMCI still has an excellent RT rating of 1.52.

The overall VST rating of 1.49 is excellent, and it’s accompanied by a BUY recommendation in the VectorVest system. Learn more about this opportunity before you make your next move - get a free stock analysis at VectorVest today!

Want These Types of Insights at Your Fingertips so You Can Win More Trades?

Use VectorVest to analyze any stock free. VectorVest is the only stock analysis tool and portfolio management system that analyzes, ranks and graphs over 18,000 stocks each day for value, safety, and timing and gives a clear buy, sell or hold rating on every stock, every day.

VectorVest advocates buying safe, undervalued stocks, rising in price. SMCI may have fallen 20% over the past few days, but the stock has still gained an impressive 191% so far in 2024. It has excellent upside potential, safety, and timing.

Before you invest, check VectorVest! Click here to ANALYZE ANY STOCK FREE and see our system in action!