Why Super Micro Computer stock traded higher Monday morning

The stock of Super microcomputer (NASDAQ: SMCI), also known as Supermicro, continued its meteoric rise to start the week. On Monday morning, the stock rose as much as 10.3%, and as of 11:59 a.m. ET today, the stock was still up 9.1%.

The catalyst that… artificial intelligence (AI) server maker higher was bullish reporting from a few Wall Street analysts.

Table of Contents

Increasing bullishness

The first bit of bullish commentary comes courtesy of JPMorgan analyst Samik Chatterjee, who initiated coverage with an overweight (buy) rating and a price target of $1,150. This indicates a potential upside of 18% compared to Friday’s closing price.

The analyst noted that Supermicro is “the leading company in the AI ​​computing market,” and he expects robust demand driven by accelerated AI adoption to continue.

Not to be outdone, Northland analyst Nehal Chokshi raised his price target to $1,300, for an upside of 34%, while maintaining an outperform rating on the stock. The analyst called Supermicro “the industry leader in server market shares” and believes the company is on track to gain a 16% share of the generative AI server market, which according to his firm estimates is worth $560 billion.

Accelerating demand

Because much of the generative AI is processed in data centers, the resulting upgrade cycle is booming and expected to continue. Bernstein analyst Toni Sacconaghi predicts the AI ​​server market will grow 75% annually over the next three years and says the expansion is “unprecedented.”

Moreover, Supermicro has continued to do so gain market share at the expense of its bigger rivals, thanks in part to partnerships with the largest AI chipmakers, giving the company early access to the most in-demand…

Read Complete News ➤

Benefits of eating guava for Americans