Top AI Company's Shares to Acquire Before They Surge by 70% as Perceived by Loop Capital
The AI boom shows no signs of slowing down, with one Wall Street analyst predicting a further surge for a standout S&P 500 company. While Nvidia is currently grabbing investor attention, this unsung hero has outperformed even the chip leader this year, boasting an impressive 212% growth.
This exceptional performance by Super Micro Computer (SMCI) can be attributed to its close partnership with Nvidia and its preferred status as a server partner. However, SMCI's in-house engineering prowess is also propelling its market share growth.
Super Micro's unique selling point is its "building block" server design. This innovative approach allows for fast, large-scale customization, saving customers money and time. With parts easily swapped and upgraded rather than full unit replacements, customers can build advanced AI infrastructure at breakneck speed.
Moreover, Supermicro's energy-efficient design is a game-changer in the age of AI. AI chips consume substantial energy and generate immense heat. Supermicro is tackling this challenge head-on with its direct liquid cooling (DLC) technology. Accounting for just 1% of the data center market now, DLC is poised to make significant strides as AI grows more energy-intensive, replacing air-cooled racks and saving both energy and space in data centers.
Sensing an opportunity, CEO Charles Liang expects DLC deployments to make up 15% of Supermicro racks this year and 30% the next. This push not only contributes to Supermicro's hypergrowth but also enhances its appealing margins for the foreseeable future.
Loop Capital, a tech-focused research firm, has taken notice of Supermicro's potential. In April, analyst Ananda Baruah upped his price target from $600 to an ambitious $1,500 per share. Baruah's optimism stems from Supermicro's ability to serve growing AI demands and its speed and agility in meeting market needs.
If these predictions come to fruition, Super Micro Computer could be on a trajectory to reach new heights, despite its remarkable year-to-date gains. Moreover, Supermicro's adaptability makes it an attractive choice, ensuring its growth and market share even in the face of competition from AI chip makers and cloud giants.
Investors looking to capitalize on Super Micro Computer's potential might want to consider investing in its stocks, as Loop Capital's analyst Ananda Baruah has set a high price target of $1,500 per share due to its ability to serve growing AI demands and its speed in meeting market needs. With Nvidia as a close partner and its innovative direct liquid cooling technology, Super Micro is well-positioned to save customers money and time while reducing energy consumption and space in data centers, potentially making up 30% of its racks in the next year.
