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Super Micro Computer (SMCI) Exceeds Market Returns: Some Facts to Consider

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The most recent trading session ended with Super Micro Computer (SMCI - Free Report) standing at $256.15, reflecting a +1.08% shift from the previouse trading day's closing. The stock outpaced the S&P 500's daily gain of 0.8%. On the other hand, the Dow registered a gain of 0.18%, and the technology-centric Nasdaq increased by 1.37%.

The server technology company's shares have seen a decrease of 2.63% over the last month, not keeping up with the Computer and Technology sector's gain of 4.96% and the S&P 500's gain of 4.39%.

Investors will be eagerly watching for the performance of Super Micro Computer in its upcoming earnings disclosure. The company's upcoming EPS is projected at $4.57, signifying a 40.18% increase compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $2.8 billion, indicating a 55.38% increase compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates project earnings of $16.88 per share and a revenue of $10.5 billion, demonstrating changes of +42.93% and +47.4%, respectively, from the preceding year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Super Micro Computer. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Currently, Super Micro Computer is carrying a Zacks Rank of #3 (Hold).

Looking at its valuation, Super Micro Computer is holding a Forward P/E ratio of 15.01. This denotes a discount relative to the industry's average Forward P/E of 18.97.

The Computer- Storage Devices industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 162, positioning it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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