Super Micro Computer: Make Sure You Buy Before Feb 25 (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• SMCI missed revenue estimates for the Dec'24 quarter and also revenue guidance estimates for Mar'25 and FY25. But I am bullish due to a 65% growth outlook for FY26.
• Margin erosion is a headwind and although there are positive catalysts ahead associated with new Blackwell products, I am unsure about whether those margin boosts would be permanent.
• Valuations have corrected sharply closer to longer-term averages. SMCI stock trades at a ~30% premium to those averages currently, but this is justified given >60% YoY growth ahead.
• Relative technicals on SMCI vs SPX500 show bullish strength ahead as the buyers react strongly off a key support level.
• Management has unequivocally assured investors that they would meet the 25 Feb '25 deadline to catch up on delayed filings. There are also no changes to previously reported financials. I think this is lifting an overhang on the stock. It seems opportune to buy before 25 Feb.

Read the full article here.