Supermicro, AI Chip Stocks Hit Record Highs Amid Volatility

Data center specialist Super Micro Computer (SMCI) and leading artificial intelligence chipmakers Advanced Micro Devices (AMD) and Nvidia (NVDA) experienced a surge in their stock prices, reaching record highs on Monday. However, the gains were short-lived as the market witnessed a volatile session.

Super Micro Computer (SMCI):

• Opening Surge: Super Micro Computer, commonly known as Supermicro, witnessed a notable spike of 14.8% to a record high of 485.86 after the opening bell.
• Pullback: Despite the initial surge, SMCI stock retreated, ending the regular session with a 3% gain, closing at 436.24 on the stock market.

The surge on Friday was prompted by Supermicro significantly raising its sales and earnings guidance for the December quarter. The company’s focus on providing server computers for AI applications has been particularly beneficial, with cloud service providers driving demand for systems equipped with the latest AI chips from AMD, Intel (INTC), and Nvidia.

Advanced Micro Devices (AMD):

• Record High: AMD stock experienced an early rise of 0.2%, reaching a record 174.65.
• Downgrade Impact: Despite the initial high, AMD stock faced a downturn, closing the regular session down 3.5% at 168.18.
• Analyst Downgrade: Northland Capital Markets analyst Gus Richard downgraded AMD to market perform from outperform, citing overestimation of AI chip sales and referencing “irrational exuberance” over AI in the stock market. KeyBanc Capital Markets reiterated its overweight rating on AMD with a price target of 195.

Nvidia (NVDA):

• Record Jump: Nvidia shares jumped 1.4% in morning trades, reaching a record high of 603.31.
• Closing: The day concluded with Nvidia stock up by 0.3%, closing at 596.54.

While Supermicro and AI chip stocks initially celebrated record highs, the volatility of the session and analyst assessments contributed to a mixed performance by the end of the trading day. Investors continue to navigate the dynamic landscape of AI-related stocks in the market.