11 Hidden AI Stocks to Buy Right Now

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7. Super Micro Computer Inc. (NASDAQ:SMCI)

Number of Hedge Fund Holders: 45

Super Micro Computer Inc. (NASDAQ:SMCI) develops and sells high-performance server and storage solutions. These solutions are crucial for AI/ML workloads. The company also offers a range of IT solutions, like complete servers, storage systems, modular blade servers, and full-rack scale solutions.

The company’s servers integrate NVIDIA GPUs, which are needed by AI and data centers. SMCI recently projected massive revenue growth and forecasted $40 billion in FY26 sales. One of the reasons behind this outlook is the demand for AI-optimized servers, particularly those incorporating NVIDIA’s advanced chips. It’s also fueled by SMCI’s direct-liquid cooling technology.

However, Goldman Sachs downgraded the stock from Buy to Sell on March 24 and reduced its price target from $40 to $32 due to the increased competition in AI servers. The firm sees risks in valuation, with the stock trading at 16x projected FY25 earnings, and expects its premium over peers to narrow due to limited product differentiation. Analyst Michael Ng also noted that SMCI’s market leadership in AI servers may weaken as rivals ramp up R&D investment.

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