Nomura analysts downgraded Super Micro Computer (NASDAQ:SMCI) to Neutral from Buy, citing limited potential for further share price increases. Following Supermi

Nomura Downgrades Super Micro Computer to Neutral Due to Limited Upside Potential

- (Last modified: Jul 11, 2024 3:05 AM)

blog post cover photo

Image credit: FMP

Nomura analysts downgraded Super Micro Computer (NASDAQ:SMCI) to Neutral from Buy, citing limited potential for further share price increases.

Following Supermicro's robust guidance for Q4/23 and Q1/24, analysts believe the company's performance outlook has shifted from easily surpassing low market expectations to having less opportunity to exceed already high expectations.

Nomura's revised outlook is influenced by uncertainties around the gradual easing of CoWoS-S supply constraints in 2024 and the potential transitional phase between Hopper and Blackwell GPUs in the latter half of the year.

The analysts acknowledge Supermicro’s competitive advantage in advanced liquid cooling solutions, which supports its gross profit margins. However, they caution that limited order visibility due to these uncertainties could make it difficult for Supermicro to exceed sales expectations, presenting a mixed outlook.

Nomura anticipates Supermicro’s quarterly sales to align with its guidance of $5.1-$5.5 billion, noting that some liquid cooling projects have been deferred to later quarters, reducing the likelihood of surpassing the guidance.

Despite these delays, analysts believe that Supermicro maintained its gross profit margin due to its strong market position and better bargaining power, even as its main competitor remained less aggressive in pricing.

Other Blogs

Nov 25, 2023 6:39 AM - Parth Sanghvi

DCF Valuation vs. Comparable Companies Analysis: Choosing the Right Valuation Method

Choosing the Right Valuation Method: DCF vs. Comparable Companies Analysis Introduction: Valuation methods play a pivotal role in determining the fair value of a company, aiding investors in making informed investment decisions. Two commonly used methods, DCF Valuation and Comparable Companies A...

blog post title

Dec 23, 2023 2:19 AM - Parth Sanghvi

Understanding the Limitations of DCF Analysis: A Guide to Overcoming Challenges

Introduction: Discounted Cash Flow (DCF) analysis stands as a cornerstone in valuing investments, yet its efficacy is contingent upon various assumptions and methodologies. While a powerful tool, DCF analysis comes with inherent limitations and challenges that investors must acknowledge to make i...

blog post title

Dec 25, 2023 2:28 AM - Parth Sanghvi

Integrating Sustainability into Valuations: Navigating ESG Factors within the Discounted Cash Flow (DCF) Model

Introduction: The investment landscape is undergoing a profound shift with a heightened emphasis on sustainability and responsible investing. In this blog post, we explore the intersection of Environmental, Social, and Governance (ESG) considerations within the Discounted Cash Flow (DCF) model, h...

blog post title


Financial Modeling Prep API provides real time stock price, company financial statements, major index prices, stock historical data, forex real time rate and cryptocurrencies. Financial Modeling Prep stock price API is in real time, the company reports can be found in quarter or annual format, and goes back 30 years in history.
2017-2024 © Financial Modeling Prep