JPMorgan says Supermicro orders ‘robust’ despite market speculation

JPMorgan keeps an Underweight rating on Supermicro (SMCI) with a $23 price target after meeting with management as part of its bus tour. The stock closed Monday up 23c to $44.16. The company’s customer base “remains robust with no significant movement of orders,” the analyst tells investors in a research note. The firm says that despite market speculation about customers moving orders to other vendors, management reassured investors that its customer base remains strong, with no significant signs of changes to order allocations. Supermicro is confident in its ability to service orders and is gearing up for new product rollouts in the second half of fiscal 2025, adds JPMorgan. It says management also dispelled concerns about shutting down operations in Malaysia, affirming that the Malaysia plant is on track to ramp in the first half of 2025. Supermicro also believes that the working capital requirements to operate at the quarterly revenue base of $5.5B-$6B remains manageable. Further, Nvidia’s (NVDA) Blackwell product line is poised for a significant ramp-up in the second half of fiscal 2025 with Supermicro’s position in customized versions “remaining strong,” according to JPMorgan.