Rosenblatt reiterates buy on SMCI stock citing AI orders

Rosenblatt maintained its "Buy" rating on Super Micro Computer Inc. (SMCI) and set a $51 price target, citing strong order momentum and the company's leading position in AI infrastructure. SMCI has secured $60 billion in new orders from over 20 customers, indicating a promising revenue growth trajectory for fiscal year 2027. The firm emphasized SMCI's competitive edge in time-to-market for AI infrastructure.

Analysts revised their consensus gross margins upward to 10% for fiscal 2027, up 140 basis points from the previous earnings report. Rosenblatt stands by its own estimate of 11% for the same period. The consensus earnings per share estimates for fiscal 2027 and 2028 have also risen by $1.10 and $1.60 respectively since the latest earnings announcement.

SMCI's stock has appreciated by $4 over this timeframe. According to InvestingPro data, 15 analysts have upgraded their EPS forecasts for the upcoming period, now forecasting $5.41 for fiscal 2027. The stock is currently valued at a P/E ratio of 11.28 and a low PEG ratio of 0.11, suggesting a potentially attractive valuation relative to its growth potential.

Rosenblatt remains confident in the stock's risk-reward profile, considering the recent estimate revisions and stock performance.