Supermicro (NASDAQ:SMCI) stock jumped about 11% in Thursday’s after-hours of trading as the company raised its second-quarter Fiscal 2024 outlook. SMCI stock rallied approximately 340% in one year, led by stellar demand for its artificial intelligence (AI) platform. The company provides high-performance server and storage solutions needed for data-intensive workloads.
Thanks to the strong demand for its rack-scale, AI, and total IT solutions, Supermicro expects to report net sales between $3.6 billion and $3.65 billion in Q2, up from its previous guidance range of $2.7 billion to $2.9 billion. Further, the company’s new revenue outlook easily exceeds analysts’ estimates of $2.8 billion.
In terms of earnings outlook, SMCI expects its adjusted EPS to be between $5.40 and $5.55 compared to its earlier forecast of $4.40 to $4.88. Moreover, this forecast is significantly higher than the Street’s expectation of $4.51.
Is SMCI a Good Stock to Buy?
The solid market and end customer demand for its products support SMCI’s bull case. However, Supermicro stock has gained substantially over the past year, keeping analysts cautiously optimistic about its prospects.
It has five Buy and one Sell recommendations for a Moderate Buy consensus rating. Analysts’ average price target of $361.33 implies 16.02% upside potential.
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