Super Micro Computer, Inc., a high-performance server and storage solutions manufacturer headquartered in California, has surprised investors by appointing BDO USA as its new auditor. The company’s stock price surged over 30% higher following the announcement. As Super Micro tries to meet compliance requirements to stay listed on the Nasdaq, investors are taking notice of the company’s promising prospects.
Despite losing nearly 75% of its market value in the last six months, Super Micro has continued to progress with key partnerships. The company’s strong relationships with leading global chipmakers, including Nvidia Corporation, Advanced Micro Devices, and Intel Corporation, are a testament to its investment appeal at a cheap valuation.
Super Micro’s financial performance remains strong, with revenue increasing exponentially. According to the preliminary Q1 2025 earnings report, revenue ranged from $5.9 billion to $6 billion for the quarter ended September 30, a notable increase from just $2.12 billion in revenue reported for the corresponding quarter last year.
The macroeconomic environment supports growth, with large-scale companies investing aggressively in boosting their data center capacity. The demand for global data center capacity is expected to grow at an impressive CAGR of between 19% and 22% to an annual demand of 171 to 219 gigawatts by 2030.
Super Micro’s diversification efforts are also impressive, with the company investing heavily in liquid cooling solutions and expanding into new markets such as 5G, telecommunications, IoT, and edge computing. The company is also expanding its manufacturing footprint globally to mitigate disruption risks.
Wall Street analysts are taking notice of Super Micro’s proposal to the Nasdaq, which could provide a much-needed grace period for the company to meet quarterly and annual report filing requirements. With an average price target of $39.43 from 10 Wall Street analysts, Super Micro appears undervalued, with a forward P/E of just 7.42.
In conclusion, despite recent regulatory concerns, Super Micro’s strong financial performance, promising partnerships, and diversification efforts make it a buy candidate. Addressing regulatory concerns will likely help the company gain momentum in the market, potentially leading to a notable expansion in valuation multiples.
Source: https://www.tipranks.com/news/super-micro-computer-stock-time-to-turn-bullish