"Super Micro Computer ( Nasdaq: SMCI | SMCI Price Prediction) is trading at $30.54, down 11.2% over the past week. Yet Wall Street analysts see the stock climbing to an average target of $41.31, implying 35% upside from current levels. That gap widened sharply during the recent selloff, raising the question: is the market pricing in risks analysts are missing, or are analysts seeing a recovery opportunity the market hasn't recognized yet?"
"The recent decline stems from growing concerns about profitability, not demand. Goldman Sachs maintained its Sell rating, citing "compressing gross margins" and limited bargaining power with hyperscale cloud customers. Gross margin compressed to 6.4%, a sharp contraction that caught investors off guard despite record revenue. The company operates as an intermediary in the AI supply chain, assembling servers using components from NVIDIA and others, which leaves it vulnerable to pricing pressure from both suppliers and customers."
Super Micro Computer's stock fell to $30.54, down 11.2% over the past week and 46% over the past year, even as AI infrastructure demand accelerates. Analysts' average price target of $41.31 implies roughly 35% upside from current levels. Revenue reached $28.1 billion over the trailing twelve months with quarterly growth of 123% year over year, and management raised full-year guidance to at least $40 billion. The selloff reflects concerns about compressing gross margins, limited bargaining power with hyperscale customers, and institutional selling, while technical indicators show weakening momentum (RSI 46.72).
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