Shares of Super Micro Computer (SMCI) slipped in after-hours trading after the computer hardware manufacturer reported mixed results for its fourth quarter of Fiscal Year 2024. Earnings per share came in at $6.25, which missed analysts’ consensus estimate of $8.10 per share. Sales increased by 143.6% year-over-year, with revenue hitting $5.31 billion. This beat analysts’ expectations of $5.303 billion.
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The company also announced a 10-for-1 stock split, which will start trading on a split-adjusted basis on October 1. A stock split is when a company increases the number of its shares, making each share cheaper, so more people can buy them. However, it doesn’t change the overall value of the company, just makes the shares more affordable and accessible.
Looking forward, management now expects revenue and adjusted earnings per share for Q1 2025 to be in the ranges of $6 billion to $7 billion and $6.69 to $8.27, respectively. For reference, analysts were expecting $5.454 billion in revenue along with an adjusted EPS of $7.58. Again, results were mixed, as revenue guidance beat but the EPS outlook missed at the midpoint of the range ($7.48).
Investor Sentiment for SMCI Stock
Although SMCI’s stock price has been struggling, the sentiment among TipRanks investors is currently very positive. Out of the 747,525 portfolios tracked by TipRanks, 2.9% hold SMCI stock. In addition, the average portfolio weighting allocated towards SMCI among those who do have a position is 6.75%. This suggests that investors of the company are confident about its future.
Interestingly, despite the stock’s recent plunge, 4% of those holding the stock increased their positions in the last 30 days, suggesting that they believe the pullback is just temporary. As a result, the stock’s sentiment is well above the sector average, as demonstrated in the following image:
Is Super Micro Computer a Good Investment?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SMCI stock based on five Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 72% rally in its share price over the past year, the average SMCI price target of $978.50 per share implies 61.06% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
