Super Micro Computer (SMCI) Hits New Lifetime High Today

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Super Micro Computer ( SMCI) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Super Micro Computer as such a stock due to the following factors:

  • SMCI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.7 million.
  • SMCI has traded 7,462 shares today.
  • SMCI is trading at a new lifetime high.

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More details on SMCI:

Super Micro Computer, Inc., together with its subsidiaries, develops and provides high performance server solutions based on modular and open-standard architecture in the United States and internationally. SMCI has a PE ratio of 22.6. Currently there are 3 analysts that rate Super Micro Computer a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Super Micro Computer has been 404,700 shares per day over the past 30 days. Super Micro Computer has a market cap of $1.2 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 1.29 and a short float of 9% with 6.20 days to cover. Shares are up 56.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Super Micro Computer as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 9.3%. Since the same quarter one year prior, revenues rose by 32.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • SUPER MICRO COMPUTER INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SUPER MICRO COMPUTER INC increased its bottom line by earning $1.16 versus $0.48 in the prior year. This year, the market expects an improvement in earnings ($1.73 versus $1.16).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Computers & Peripherals industry. The net income increased by 96.4% when compared to the same quarter one year prior, rising from $8.43 million to $16.55 million.
  • Powered by its strong earnings growth of 78.94% and other important driving factors, this stock has surged by 96.70% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • Although SMCI's debt-to-equity ratio of 0.10 is very low, it is currently higher than that of the industry average. Although the company had a strong debt-to-equity ratio, its quick ratio of 1.00 is somewhat weak and could be cause for future problems.

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