JPMorgan predicts further 18% increase for AI stock soaring 764% in the past year

JPMorgan predicts further 18% increase for AI stock soaring 764% in the past year

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  • Super Micro Computer has soared 764% over the past year, and JPMorgan thinks there’s even more upside potential.

  • The bank said Super Micro Computer was disrupting the traditional server market through its AI server stack.

  • “We expect our leadership to continue, through a balance of customized solutions and rapid time-to-market,” the company said.


THE sharp rise in Super Micro Computer stock over the past year isn’t going to slow down anytime soon, according to JPMorgan.

The bank initiated Super microcomputer stock with an “overweight” rating and a price target of $1,150 on Monday, representing a potential upside of 18% from Friday’s close. Stocks jumped about 6% Monday following JPMorgan’s bullish debut report.

“Super Micro is the leading company in the AI ​​compute market, which is experiencing growing demand for AI model training, retrieval-augmented generation by CSPs and Tier 2 enterprises, and eventually AI inference workloads,” JPMorgan said.

Super Micro Computer Actions have surged 764% over the past year thanks to the rise of its AI server business. The sharp rise in the company’s stock price propelled the San Jose-based company from the small-cap Russell 2000 index to the large-cap index. S&P500 index, giving it a market valuation of around $60 billion.

JPMorgan expects Super Micro Computer’s recent dominance to continue as it disrupts the traditional server market with its AI-enabled server stacks.

“We expect our leadership to continue, through a balance of customized solutions and rapid time-to-market, although upside potential is more likely through rapid expansion of the AI ​​server market rather than to the expansion of an already premium valuation multiple,” JPMorgan said.

The AI ​​company trades at a forward price-to-earnings ratio of around 34x, which is well above the S&P 500’s forward price-to-earnings multiple of around 20x. But this valuation multiple appears to be justified by Super Micro Computer’s astonishing growth, with JPMorgan forecasting a compound annual revenue growth rate of 43% through 2027.

“Revenue forecasts for 2027 imply that Super Micro will have 10-15% share of the AI ​​server market, which we view as conservative given its early lead,” JPMorgan said. “We believe investors should own the AI ​​Server theme given the rapid expansion of the overall market and potential upside to earnings.”

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