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Important points
- Supermicrocomputer stocks soared in after-hours trading Friday after the AI server maker announced it would join the S&P 500 index.
- The company’s stock has risen more than 200% since early 2024, driven by a surge in demand for AI servers that make it easier to train and deploy AI models.
- Super Microcomputer’s stock price could find support between $300 and $350 during profit taking from the upper trendline of the ascending triangle and the rising 50-week moving average.
Super Microcomputer Inc. (SMCI) shares surged 12.5% in after-hours trading on Friday after the artificial intelligence (AI) server maker’s announcement that it will be included in the large-cap S&P 500 index. He will remain on the watch list on Monday.
The San Jose, Calif., company’s stock has more than tripled since the beginning of the year, and its market capitalization has soared to more than $50 billion amid an AI-powered buying frenzy. Super Micro & Decker’s Outdoor Corporation (DECK) plans to remove white goods manufacturer Whirlpool (WHR) and regional bank Zion Bancorporation (ZION) from its blue-chip index, with changes to 3. It was reported that the agreement will take effect before trading begins on the 18th. S&P Global. Stocks added to the S&P 500 typically increase in value as exchange-traded funds (ETFs) or mutual funds that track the benchmark index add new stocks to their portfolios.
Super Micro’s server and hardware infrastructure solutions accelerate the training and deployment of AI models by enabling data center operators to economically deploy AI accelerators, helping the company maximize widespread adoption of the technology. so that it can be used for
Additionally, the company backs up its AI story with financial results. In the latest quarter, the hardware maker’s net sales more than doubled year-over-year, and quarter-on-quarter, he increased 73%. Supermicro also raised its full-year 2024 revenue guidance to $14.3 billion to $14.7 billion, up from previous expectations of $10 billion to $11 billion, demonstrating the company’s future growth potential.
Microcomputer stocks have been on a steady upward trend since May 2020, when the 50-week moving average broke above the 200-week moving average, generating a golden cross buy signal. What is impressive is that although the stock retraced several times in 2023, it failed to reach the 50-week moving average, highlighting the strength of the uptrend.
Recently, the rally above average volume accelerated after the price broke out of a four-month consolidation period in an upward triangle shape. This chart pattern suggests a continuation of the current long-term trend. If you see a wave of profit-taking in the stock, keep an eye on the $300-$350 level where the upper trendline of the triangle and rising 50-week moving average could provide support for a pullback.
Supermicro shares rose 12.5% to $1,019 in after-hours trading on Friday. The stock had risen 4.5% during regular trading hours before the news of its inclusion in the S&P 500 was announced.
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As of the date this article was written, the author did not own any of the securities mentioned above.
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