Super Micro Computer Inc. (SMCI), a leading provider of high-performance server and storage solutions, released its preliminary Q2 FY2025 earnings report yesterday. The report fell short of market expectations on revenue and EPS, prompting the market to react swiftly, with SMCI stock falling over 9% in the aftermath. Also playing a part are SMCI’s regulatory filing delays, which have caused significant market concern. To meet Nasdaq’s compliance deadline, the company aims to become current with its filings by February 25, 2025.
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In the midst of this turbulence, two five-star investors, Denil Sereda and Henrik Alex, have offered contrasting views on SMCI’s recent performance and future outlook.
Two Top Analysts, Two Opposing Views
Sereda has a far more optimistic point of view about SMCI’s prospects. He acknowledges the company’s earnings miss but highlights the positive developments that followed the earnings call. Sereda notes that SMCI’s comments on the earnings call were optimistic, emphasizing the company’s readiness to offer advanced tech solutions. He states, “Super Micro’s DCBBS strategy (Datacenter Building Block Solutions) allows it to offer more standardized and pre-configured server and data center solutions, tailored to clients’ specific workload and infrastructure requirements.” Sereda believes that the updated guidance drove the market’s initial negative reaction. Still, recovery is well on the cards, fueled by short-covering and positive sentiment around the company’s future growth.
On the other hand, Henrik Alex remains skeptical about SMCI’s ability to meet its ambitious projections. He points out that the company’s Q2 results and Q3 guidance were below expectations, with revenues impacted by the limited availability of Nvidia’s (NVDA) latest GPUs. Alex is particularly critical of SMCI’s bold FY2026 revenue projection of $40 billion, which he finds lacking in tangible evidence. He remarks, “While management’s optimism remained unbridled, as evidenced by the CEO’s stellar FY2026 revenue projection, I remain skeptical regarding the company’s ability to live up to these bold sales projections.” Alex reiterates his “Sell” rating on SMCI shares, citing potential competitive pressures and slower growth at key supplier Nvidia.
The gap between these two analysts highlights the uncertainty surrounding SMCI’s future. While Sereda sees potential for growth driven by advanced technology solutions and strategic partnerships, Alex remains cautious, questioning the feasibility of the company’s ambitious targets.
Is SMCI Stock a Good Buy?
Super Micro Computer is considered a Hold on Wall Street, reflecting the analysts’ opposing views on SMCI stock. The average price target is $29.75, implying a 22.95 downside potential.
