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Super Micro Computer (SMCI) Gains But Lags Market: What You Should Know

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Super Micro Computer (SMCI - Free Report) closed at $83.87 in the latest trading session, marking a +0.67% move from the prior day. The stock lagged the S&P 500's daily gain of 1.49%. Meanwhile, the Dow gained 1.6%, and the Nasdaq, a tech-heavy index, added 0.06%.

Heading into today, shares of the server technology company had lost 5.03% over the past month, outpacing the Computer and Technology sector's loss of 5.29% and lagging the S&P 500's loss of 3.49% in that time.

Investors will be hoping for strength from Super Micro Computer as it approaches its next earnings release. The company is expected to report EPS of $2.76, up 213.64% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $1.75 billion, up 49.27% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $9.58 per share and revenue of $6.8 billion. These totals would mark changes of +69.56% and +30.86%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Super Micro Computer. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Super Micro Computer is currently a Zacks Rank #1 (Strong Buy).

Valuation is also important, so investors should note that Super Micro Computer has a Forward P/E ratio of 8.7 right now. Its industry sports an average Forward P/E of 15.8, so we one might conclude that Super Micro Computer is trading at a discount comparatively.

The Computer- Storage Devices industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 44, which puts it in the top 18% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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