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On Wednesday, Citi analysts adjusted their stance on Super Micro Computer (NASDAQ:SMCI), reducing the price target from $39.00 to $37.00 while maintaining a Neutral rating. Currently trading at $32.94, the stock has shown significant volatility, with analyst targets ranging from $15 to $93. The adjustment followed Super Micro Computer’s recent financial report, which aligned with the company’s prior negative preannouncement. The reported earnings met expectations, but the forecast for the June quarter fell short of consensus, indicating that revenue delays due to customers waiting for next-generation GPUs may persist beyond the current quarter.
Super Micro Computer’s management expressed optimism about future revenue growth, citing strong order momentum in the current quarter-to-date (QTD), the transition to new GPU technology, which is expected to bring higher customization and better margins, and the anticipated doubling in volume of next-generation Direct Liquid Cooling (DLC) solutions. The company’s impressive revenue growth of 125% in the last twelve months and strong financial health score from InvestingPro support this optimism. Additionally, the company is progressing with its manufacturing expansion in Malaysia. However, the fiscal year 2026 revenue target of $40 billion was not reaffirmed, with management attributing this to macroeconomic uncertainties, including the impact of tariffs and AI diffusion rules on the company’s growth trajectory.
In light of these factors, Citi analysts have moderated their estimates for Super Micro Computer. The revised target price of $37.00 is based on a 9-9.5x price-to-earnings (PE) ratio, while the stock currently trades at a P/E of 13.35x. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value model, which considers multiple valuation metrics and growth prospects. Despite the changes in the financial outlook and the challenges ahead, the firm’s analysts continue to advise a Neutral position on Super Micro Computer’s stock.
The adjustment in Super Micro Computer’s price target reflects concerns over competitive dynamics, GPU allocation, and visibility, as well as the uneven nature of AI-related revenues. The company’s performance and outlook are being closely monitored by investors, who are keenly interested in how Super Micro Computer navigates the evolving market conditions and technological advancements in the GPU sector. For deeper insights into SMCI’s valuation and growth prospects, including 14 additional ProTips and comprehensive financial metrics, investors can access the detailed Pro Research Report available on InvestingPro.
In other recent news, Super Micro Computer reported its financial outcomes for Q3 2025, showcasing mixed results. The company achieved a non-GAAP earnings per share of $0.31, narrowly surpassing the forecast of $0.30. However, its revenue of $4.6 billion did not meet the expected $5.05 billion, reflecting a shortfall that concerned investors. The company has set its Q4 2025 revenue guidance between $5.6 billion and $6.4 billion. In terms of analyst activity, there were no specific upgrades or downgrades mentioned, but firms like JPMorgan and Goldman Sachs expressed interest in the company’s outlook amid macroeconomic uncertainties. Super Micro Computer continues to focus on AI infrastructure, with AI GPU platforms contributing significantly to its revenue. The company is also expanding its global manufacturing footprint, which includes new facilities in Malaysia and other regions, to meet rising demand.
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