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SMCI Stock Jumps On Raised Guidance Amid Strong Computer Server Demand


Computer server builder Super Micro Computer (SMCI) raised its guidance for June-quarter revenue and earnings, pointing to expected upside from customer design wins. SMCI stock jumped on the news.




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San Jose, Calif.-based Super Micro. released preliminary fiscal fourth-quarter results after the market closed on Wednesday. Super Micro stock jumped 15.1% to 52.45 in morning trading on the stock market today.

With the move, SMCI stock surged above the previous 5% buy zone that advanced to 50.49 from an entry point of 48.09, according to MarketSmith charts.

However, SMCI stock has been volatile. It exited a 16-week consolidation period on May 4 after its last earnings report. The SMCI hit an all-time high of 58.34 the next day. But it triggered a stop-loss sell rule on June 16 when it fell 7% to 8% below its 48.09 buy point.

Its current sloppy stock chart suggests a cup pattern with a potential buy point at 58.44.

SMCI Stock: Earnings Calls Set For August 9

Super Micro raised its adjusted earnings forecast for the June quarter to a range of $2.30 to $2.40 a share compared to its prior guidance of $1.51 to $1.69. Super Micro said it expected June-quarter revenue to be in the range of $1.58 billion to $1.63 billion, up 50% from a year earlier, ahead of its prior guidance of $1.4 billion to $1.48 billion. of the company.

The company has scheduled an earnings call for August 9.

Super Micro builds computer servers using x86-based microprocessors from Intel (INTC) and other chipmakers. INTC stock fell 1.7% to 39.87 on Thursday.

“Although it is important to note that Super Micro has reported significant growth above the industry over the past few quarters, we believe that Super Micro’s results can be considered a net positive data point for business server and server CPU demand,” Wells Fargo analyst. Aaron Rakers said in a report.

Earnings for INTC stock are July 28 amid fierce competition in the Advanced Micro Devices (AMD) and Nvidia (NVDA) in the computer server market.

Super Micro A Share Gainer

Super Micro builds computer servers in Taiwan. It also uses microprocessors from AMD and Nvidia.

According to a Bloomberg report, Super Micro’s computer servers are being used to mine the Bitcoin cryptocurrency in China.

“Super Micro had roughly a 5.3% share of the x86 server fleet during Q1, up from a 4.9% share a year ago, according to Gartner,” Rakers said. “We also note that Super Micro has a strong position in high-performance computing (HPC) environments using Nvidia GPUs.”

At Susquehanna, analyst Mehdi Hosseini has a cautious view of Super Micro’s June quarter pre-announcement.

“Are quarterly revenue and earnings of $1.6 billion and $2.40, respectively, a peak?,” he asked in a research note. “We await the company’s earnings conference call scheduled for August 9 for more color.”

If you’re new to IBD, consider checking out its stock trading system and CAN SLIM basics. Recognizing chart patterns is a key to investment guidelines.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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