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Super Micro Computer (SMCI) rallied as much as 20% on Wednesday after filing its long overdue 10-K and regaining compliance with Nasdaq minimum listing requirements. The company also reported its audited financial results for the first two quarters of its fiscal 2025.
Including today’s surge, shares of the AI server company are nearly 70% in the year to date. Still, Ananda Baruah, a Loop Capital analyst, continues to see significant further upside in SMCI shares.
Does Supre Micro Stock Have Any Further Upside Left?
Loop Capital reiterated its “Buy” rating on Super Micro Computer today and raised its price target to $70, indicating 30% potential upside from current levels.
Analyst Ananda Baruah continues to see SMCI as a key beneficiary of artificial intelligence – and expects the ramp-up of Nvidia’s (NVDA) latest Blackwell chips to serve as a meaningful tailwind for the tech stock in 2025.
Super Micro sock is also worth owning at present because its key customers have significant plans for this year, he told clients in a research note on Tuesday. That said, the Nasdaq-listed firm remains unattractive for income investors as it doesn’t currently pay a dividend.
SMCI Remains a Risky Investment in 2025
While there are significant tailwinds that could drive the Super Micro share price up in 2025, investors should consider the potential risks involved as well before choosing to park their capital in SMCI.
For starters, the company could see increased pressure on demand as giants like Google (GOOGL), Amazon (AMZN), and Microsoft (MSFT) continue to switch to custom-built solutions.
Additionally, the AI server specialist lost some of its market share to rivals Dell (DELL) and HP Enterprise (HPE) while it was dealing with allegations of financial misconduct in the back half of 2024. Investors should note that the company is still under investigation by the Department of Justice and the Securities and Exchange Commission due to those allegations.
Do Other Analysts Share Baruah’s Optimism on SMCI?
The aforementioned headwinds may be why other analysts don’t particularly agree with Ananda Baruah on Super Micro Computer.
Wall Street currently has a consensus “Hold” rating on SMCI shares with a mean target near $53 that’s roughly in line with its current share price. Its Street-high target of $100 implies that shares could double from here.
