KeyBanc starts Super Micro at Sector Weight on lower growth and margins

As previously reported, KeyBanc initiated coverage of Super Micro (SMCI) with a Sector Weight rating. Expectations for the stock could be high as the company may have set expectations too high for FY26 given that the overall end market appears to be decelerating and getting more competitive, the analyst tells investors in a research note. KeyBank adds that Super Micro’s margins will trend lower over time, and given the lower growth, lower margins, and the company lacking free cash flows, it is taking a more cautious view.