Super Micro Computer (SMCI) has made it to the highly select IBD Sector Leaders list as shares rally to all-time highs after a six-week win streak.
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The stock has perfect Composite and Relative Strength Ratings of 99. The maker of computer hardware broke out of a cup base with a buy point of 75.03 in heavy volume Nov. 2 following the latest earnings report.
At Friday’s close, the stock had climbed 25% from the buy point. When gains reach 20% or 25%, investors should be taking at least some profits. Yet, the chart shows no sell signals.
In the third quarter, sales grew an impressive 79% to $1.8 billion from the same quarter last year while earnings per share of $3.42 grew a whopping 490% from 58 cents over the year-ago period.
The San Jose, Calif. based company makes storage systems, graphic processing units, power and chassis products for enterprises, cloud, AI applications and data center computing. It also offers system management software. The company also has offices in Europe and Asia. In 2021, Super Micro Computers announced that it was doubling its manufacturing to meet server and cloud demand.
Computer Stock’s Strong Profitability
The stock has an ideal SMR rating of A which also shows the company’s strong record of sales and earnings growth, profit margins and return on equity.
SMCI stock ranks first in the computer hardware and peripherals group. The group itself ranks 46th out of IBD’s 197 industry groups. Other companies in the group include Logitech (LOGI), Dell (DELL) and HP (HPQ).
Mutual funds hold 52% of shares outstanding. Super Micro also has a top notch Accumulation/Distribution Rating of A, which shows very strong interest from institutional investors.
Several ETFs hold the stock as well. These include the iShares Russell 2000 ETF (IWM) and Vanguard Small Cap Value ETF (VBR).
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Source: https://www.investors.com/stock-lists/sector-leaders/computer-stock-hits-profit-target/?src=A00220&yptr=yahoo