Super Micro Computer (SMCI) has moved past last year’s audit-related issues, clearing the threat of a potential NASDAQ delisting. With investor confidence beginning to recover, Raymond James’ Top analyst Simon Leopold has initiated coverage on the stock with an Outperform rating (equivalent to Buy) and a $41 price target. The price target implies a 22.3% upside potential from current levels. Leopold points to Supermicro’s strong position in the AI server market and the growing demand for accelerated computing as key drivers.
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It is worth noting that Leopold ranks 540 out of more than 9,527 analysts tracked by TipRanks. He has a success rate of 57%, with an average return per rating of 8.80% over a one-year timeframe.
Leopold Sees Super Micro as a Fast-Rising AI Server Player
Simon Leopold views Super Micro as rapidly evolving into a “near AI pure play,” with AI-related platforms now contributing close to 70% of its overall revenue. He believes the company has carved out a valuable position between full-service tech giants like Dell Technologies (DELL) and Hewlett Packard Enterprise (HPE) and lower-cost system builders such as Quanta Computer Inc.
According to Leopold, what sets Supermicro apart is its ability to deliver highly customized, flexible platforms at competitive prices. These made-to-order solutions are especially appealing to large hyperscale customers. This focus on tailored products, rather than bundled services and financing, helps the company stay lean and cost-efficient. Leopold views this strategy as a key strength that continues to fuel Supermicro’s rise in the AI server market.
Recent market data supports this view. According to an independent market research firm, Dell’Oro, Supermicro holds 9% of the total AI platform market and 31% among branded suppliers. Leopold interprets these figures as clear signs of the company’s growing traction.
He also points to Supermicro’s early investment in liquid cooling, now a critical feature for managing the heat and energy demands of advanced GPUs. Its ability to support specialized builds has helped it secure business from high-demand clients like CoreWeave (CRWV), a cloud infrastructure company and xAI.
Growth Drivers for Super Micro
Looking ahead, Leopold outlines several growth drivers for Supermicro, including rising demand for hyperscale AI systems, deeper expansion into sectors like finance and healthcare, and the company’s growing U.S. manufacturing footprint. Moreover, its plan to build 1,500 liquid-cooled AI racks per month in the U.S. could provide a local advantage amid ongoing trade tensions.
Risk Factors and Valuation
Still, Leopold points out a few risks. Super Micro’s stock has seen ups and downs, partly due to “lumpy performance” and past “reputational risk.” For instance, a recent earnings miss, driven in part by NVIDIA’s (NVDA) shift from Hopper to Blackwell chips, illustrates how GPU transitions can affect short-term results.
He also notes that Super Micro doesn’t offer the full range of services that bigger tech firms do, which could limit its ability to capture enterprise opportunities. Still, he believes the company is starting to make progress and has room to expand.
From a valuation perspective, Leopold thinks the stock is “undervalued.” It trades at about 9 times expected 2026 earnings, even though revenue is likely to grow more than 25% a year. He believes this strong growth and Supermicro’s role in the AI market should support a higher stock price.
Is SMCI a Good Stock to Buy?
Currently, analysts remain divided on SMCI’s long-term stock trajectory, mainly due to the macro headwinds. On TipRanks, SMCI stock has a Moderate Buy consensus rating based on six Buys, five Holds, and one Sell rating. Also, the average Super Micro Computer price target of $40.83 implies 21.81% upside potential from current levels. Over the past year, SMCI stock has lost over 57%.
