Shares of IT products manufacturer Super Micro Computer (NASDAQ:SMCI) surged nearly 7.5% in the pre-market session today after its first quarter EPS of $3.43 outpaced expectations by $0.14. Similarly, revenue of $2.12 billion exceeded estimates by $10 million.
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Notably, despite GPU supply constraints, the company raised its outlook for Fiscal year 2024, with revenue anticipated to range from $10 billion to $11 billion. Further, revenue for the second quarter is expected to be between $2.7 billion and $2.9 billion. EPS for the quarter is seen landing between $4.40 and $4.24.
Amid the present global macroeconomic environment, SMCI maintains a healthy balance sheet, with a cash pile of $543 million that outstrips its total bank debt of $146 million. The company generated $271 million in cash flow from operations in the first quarter. Additionally, robust demand for AI infrastructure and the expected introduction of new computing and storage products bode well for SMCI.
Is SMCI a Good Stock to Buy?
Overall, the Street has a Moderate Buy consensus rating on Super Micro. After a mega 251% rally in SMCI shares over the past year, the average SMCI price target of $347.50 implies a further 37.7% potential upside.
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