On Thursday, shares of Super Micro Computer (SMCI) surged 14% to a new all-time high on speculation that the computing, storage, and networking solutions provider would reap substantial profits from the anticipated uptick in demand for artificial intelligence (AI).
The stock’s price objective was increased by 39% to $961 from $691 by Barclays analysts. The reason given was Super Micro Computer’s role in the AI ecosystem and the company’s “strategic” connections with companies including NVIDIA (NVDA), AMD (AMD), and Intel (INTC).
“As AI architecture becomes more complex, SMCI has design capabilities to mix/match components to meet a customer’s increasingly varied needs, as well as using flexible manufacturing with scale to meet these varied requirements,” the researchers stated.
A “buy” recommendation was used to commence coverage by Bank of America analysts, who also stated that they anticipate “this provider of server and storage solutions will be a beneficiary of AI-driven demand growth.”
According to analysts from Bank of America, “We believe the market for AI servers is much larger than is factored in Street models.”
They also mentioned that Super Micro Computer will benefit from the upcoming debut of numerous AI-related processors because of its “ability to work with multiple new designs and technologies.”
On Thursday, Super Micro Computer stock reached a new all-time high of $1,004 per share, an increase of 14%. Since the beginning of 2024, the stock’s value has increased by more than 100%.
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