In the latest market close, Super Micro Computer (SMCI) hit $47.27, marking a -0.66% move from previous day. The range of stock price fluctuations was lower than the S&P 500’s daily gain of 0.4%. Meanwhile, the Dow Jones Industrial Average rose 0.09%, and the tech-heavy Nasdaq index rose 0.63%.
Shares of the server technology company have gained 8.84% over the past month, outpacing the Computer Technology sector’s gain of 4.88% and the S&P 500’s gain of 3.76%.
Supermicrocomputer’s upcoming earnings release will be of great interest to investors. The company’s EPS is expected to be $0.75, representing growth of 120.59% compared to the same period last year. Our latest consensus estimate is calling for quarterly revenue of $6.52 billion, up 207.52% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $3.35 per share and revenue of $28.01 billion, which would represent changes of +51.58% and +87.45%, respectively, from the prior year.
It is also important for investors to note recent revisions to analyst estimates for Super Micro Computer. Such recent changes usually indicate a change in the status of short-term business trends. As a result, positive estimate revisions indicate analyst confidence in the company’s business performance and earnings potential.
Our research shows that these estimate adjustments are directly related to impending stock performance. To benefit from this, we have created the Zacks Rank, a quantitative model that includes these estimate changes and presents an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell) and has an impressive, outside-audited track record of outperforming expectations, with #1 stocks generating an average annual return of +25%. It has come true. The Zacks Consensus EPS estimate remained unchanged over the past month. Super Microcomputer currently has a Zacks Rank of #2 (Buy).
Looking at the valuation in detail, Super Microcomputer’s current forward P/E ratio is 14.2x. This represents a discount compared to its industry’s average Forward P/E of 14.45.
The computer storage devices industry is part of the computer and technology sector. This industry currently has a Zacks Industry Rank of 71, putting it in the top 29% of all 250+ industries.
The Zacks Industry Rank is ordered from highest to lowest based on the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2:1.
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