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Investors are loading up on Super Micro Computer (SMCI) stock ahead of the artificial intelligence (AI) server specialist’s Q4 results scheduled to be released today after market close.
Consensus is for the San Jose-headquartered firm to record $0.56 in earnings per share (EPS) for its fourth quarter, which would represent about an 80% increase on a year-over-year basis.
The quarterly release arrives at a time when Super Micro shares are starved for investor interest, currently down more than 35% versus their year-to-date high.
What Is Barchart’s Opinion on Super Micro Stock?
Heading into the Q4 print, Barchart's average opinion was raised on SMCI shares to “HOLD” from “72% SELL” last month, indicating technical momentum is building in favor of the AI company.
And the derivatives market agrees with the technical setup as well. The put-to-call ratio on options contracts expiring Aug. 14 sits at 0.35x currently, signaling a strong bullish skew.
According to Barchart, the upper price on those contracts is set at $35.47 as of writing, suggesting Super Micro could rally nearly 12% through the end of this week.
That said, SMCI remains unattractive for income-focused investors as it does not currently pay a dividend.
Should You Invest in SMCI Shares Ahead of Q4 Print?
Super Micro stock remains a compelling long-term buy also because it’s unusually inexpensive to own for an artificial intelligence beneficiary.
At a price-to-sales (P/S) multiple of less than 1x, the Nasdaq-listed firm is notably cheaper than its AI server rival Dell Technologies (DELL) at nearly 2.6x.
Note that Super Micro Computer has already unveiled its Data Center Building Block Solution (DCBBS) Blueprint optimized for next-gen architecture.
On the upcoming earnings call, if management issues upbeat guidance for the full financial year, it may just prove the catalyst SMCI so desperately needed to recover its recent losses.
How Wall Street Recommends Playing Super Micro
Investors should also note that Wall Street analysts are also bullish on SMCI stock heading into its fiscal Q4 earnings on Aug. 11.
While the consensus rating on SMCI sits at “Hold," the mean price target sits at about $36, indicating potential upside of more than 10% from current levels.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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