Super Micro Computer Inc SMCI has emerged as a primary beneficiary of the artificial intelligence (AI) market explosion.
The San Jose, California-based company is poised to attain robust revenue growth in the coming years, primarily attributed to the burgeoning demand in the AI sector, as per BofA Securities.
The Super Micro Computer Analyst’s View: BofA Securities analyst Ruplu Bhattacharya has initiated coverage of Super Micro Computer with a Buy rating and a price target of $1,040.
The Promising Outlook for Super Micro Computer: The company is augmenting its backlog and expanding capacity to bolster substantial revenue growth, Bhattacharya stated in the initiation note.
More than 50% of Super Micro Computer’s revenues are currently linked to accelerators such as GPUs, as outlined by the analyst.
Bhattacharya pointed out that the AI server market’s potential is significantly greater than what is projected by the Street models and could witness a 50% CAGR growth over the next three years, in contrast to the historical 5.5% of the overall server market over the past 17 years. He also suggested that Super Micro Computer’s revenues could escalate even further, leading to a gain in market share.
SMCI Price Movement: The shares of Super Micro Computer had surged by 9.27% to $962.17 at the time of publication on Thursday.
