SMCI up 7% today, 13% in less than a week

I see no news that would be a catalyst. It’s hard to believe the stock was trading around 7x earnings and 0.7x sales just a year ago. Revenue growth is strong, but still below all time heights and current P/E of 7 and P/S of 2.3 seem low given growth rates in revenue in the high 30s and profits almost 100%. Did everyone just wake up to the stock all at once?

Perhaps there was downward pressure at year end as folks could exit positions with large long term gains and now the market is siezong the opportunity that was created.



TMF has three separate (freebie) articles promoting the stock today. So that is likely part of it, combined with a green day overall for the sector.



Today, 1/18/24, SMCI announced new, and greatly improved forward guidance after hours, this shot the stock up 10%.

The San Jose, Calif.-based company now expects sales of $3.6 billion to $3.65 billion, up from its prior guidance of $2.7 billion to $2.9 billion, for its fiscal second quarter ended Dec. 31. The midpoint of $3.625 billion is well above Wall Street’s target of $2.8 billion.

Supermicro predicted adjusted earnings per share of $5.40 to $5.55, up from its previous outlook of $4.40 to $4.88. The midpoint of $5.48 a share compares with the analyst target of $4.51, according to FactSet.

Supermicro cited a “strong market and end customer demand for our rack-scale, AI and total IT solutions” for the raised guidance, according to a news release.

This correlates with NVDA’s ever improving outlook.


And today, up 36%! I could use a few more like that.


What a difference a month makes! Now at almost 70x earnings and over 5.5x sales. At 990, price is about 3x where it was when this thread began. WWSD? Trim or ride it further? I know there are a lot of variables that go into it, but I am torn because it’s not that there aren’t other growing stocks more richly valued, but they tend to be less asset heavy and without the unbelievable run up.


I’ve been trimming this week, don’t want it to get too big.

I’m keeping it around 12%, tops, for now. I’ll probably trim more before NVDA earnings as any bad news could cause some big downside.

The stock has come a long way but with a two trillion-dollar buildout of data centers, hopefully it can keep picking up a nice piece of the pie.


I trimmed about 10% yesterday and hope that my process justifies the good outcome. I don’t yet have a concentrated portfolio - still working on it - so it wasn’t keeping me up at night because of it being a large % of my portfolio. It was more the lesson learned in the great fall of 2022 - you only need to get rich once. I did not create a cash cushion as my portfolio rocketed in 2021 and that was bad. I am still working so I wasn’t forced to sell low, but I decided to set a portion of future profits aside if and when my portfolio recovered. I am following that plan and this was an opportunity to take advantage of the stock’s. Huge runup. Thanks to all on this board.


An analyst downgrade caused the stock to go drop 12% today. I’m down to a 7.9% position. It has had quite a run, time to preserve some profits and buckle up for the NVDA earnings call next week.


Since we’re sharing how we’re dealing with SMCI’s run…it bumped up against my personal 25% ceiling several times during the last 2 weeks and I ended up trimming 20% of my shares to keep it below. But then I decided to stop trimming, because enough is enough, so I’m letting it ride because:

  • I’m very bullish on AI
  • I don’t know enough about valuation and it seems a pretty inexact science anyway
  • There are no signs that I’m aware of that SMCI business performance will suffer in the short term
  • I’m feeling confident about NVDA earnings (#2 in my portfolio)

After today it’s down to 24% of my portfolio. I’ll write more in my post-earnings portfolio recap.


I had recently sold 1/3 of my shares because of the parabolic rise after I bought it at $288. I came back from lunch today and saw it hit $1077 and then had plummeted to $850 and on HUGE volume, so I sold all. It has continued down and is at $814. I know this is not proper discussion for this board and Saul might ban me, but I think it is important to recognize this is a quintessential Climax top, which is a very bad technical sign.

I will probably add to my GCT as it is a fast grower and is strong again today. Great growth fundamentals. I will try to post details later.



It retreated all the way back down to its price on …Tuesday.