By Mackenzie Tatananni
Super Micro Computer stock has rebounded since selling off sharply in the wake of President Donald Trump's "Liberation Day" tariffs announcement -- and it could surge higher, according to one analyst who says there's still time to buy in.
Artificial-intelligence server stocks tumbled after the U.S. unveiled reciprocal levies on key trading partners on April 2. Super Micro shares, which trade under the ticker SMCI, fell as much as 16% through April 21. However, they have rebounded since Trump's announcement and were up 39% since then through Wednesday's close.
Mizuho analyst Vijay Rakesh raised his price target on shares of the server maker to $47 from $40 in a note Thursday and maintained a Neutral rating.
"Strong server shipments" underpinned the price hike, with a solid need for AI servers expected to continue into 2026. Rakesh sees sustained demand from Microsoft partners -- particularly so-called Tier 2 Cloud Solution Providers, who buy and resell Microsoft services from a distributor. Super Micro manufactures hardware that is optimized for systems including Microsoft's flagship Azure stack.
Super Micro has also identified "strong sovereign demand" in the Middle East, Rakesh noted. The server maker signed a $20 billion deal with Datavolt, a Saudi Arabian data center company, in May. The multiyear agreement is meant to speed up the delivery of Super Micro's server and rack systems to DataVolt's hyperscale campuses.
Rakesh boosted his price target on several other companies benefiting from data-center growth, including chip maker Nvidia. The analyst maintained an Outperform rating and raised his price on the shares to $185 from $170, citing strong demand for its Blackwell chips into the second half of 2025 and start of 2026.
The analyst is even more bullish on Broadcom, which he rates at Outperform with a $315 target price, up from $310. In his view, shipments of the company's custom AI chips could exceed Nvidia graphics processing units by 2026.
Intel and Advanced Micro Devices also had their estimates changed.
Intel CEO Lip Bu-Tan is leading a turnaround strategy with "a renewed focus on engineering leadership," Rakesh said, while the company simultaneously aims to reverse share loss in the traditional server and PC markets.
Meanwhile, the analyst said AMD could benefit from ramping up demand for AI accelerators, even as "key competitor" Nvidia stays ahead of the pack. Rakesh rates Intel and AMD at Neutral and Outperform, respectively.
Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
July 03, 2025 09:37 ET (13:37 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.