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Nvidia isn’t the only star of the artificial intelligence boom. In fact, there’s an even “hotter” boom right now, according to Louis Navellier, chairman and founder of Navellier & Associates. That’s Super Micro Computer, a Nasdaq-listed company that makes AI systems and graphics processing unit servers. Last year, the company’s stock price soared even faster than Nvidia’s, soaring 960%. This is much higher than Nvidia’s over 200%. This has continued since the beginning of this year. Supermicrocomputers rebounded more than 200% compared to NVIDIA’s 59%. “Super Micro is getting more attention than Nvidia, and they’re getting more attention,” Navellier, who has owned Super Micro Computer stock for more than two years, told CNBC’s “Street Signs Asia.” “The reason is because they drove the stock price higher, they beat guidance. And although it’s not currently in the S&P 500, it probably will be.” It may not be too late to get involved. Navellier says investors looking to capitalize on the AI trend should focus on hardware stocks rather than software stocks. He says there are only two companies that are dominant in this space: Nvidia and Super Micro Computer. “Right now there are no other companies that can do that,” he said. “If you look at the one-year earnings forecast, the multiple is not that bad.” “Supermicro is not that expensive,” Navellier added. Wall Street analysts have also recently put their faith in super microcomputers. In mid-February, Bank of America highlighted the super microcomputer as something investors may have overlooked, citing a growing backlog and capacity expansion. The investment decision is “buy” and the target price is $1,040, suggesting an upside potential of about 21%. Shares closed Friday around $860. Last week, Rosenblatt set a price target of $1,300 (about 51% upside) for the company’s stock, citing “solid growth” in AI computing and the company’s “strategic position” in this market. Supermicrocomputer received a 71% buy rating from analysts covering the stock, according to FactSet data. — CNBC’s Samantha Soobin and Ha-Kyung Kim contributed to this report.
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