Super Micro Computer (NASDAQ:SMCI) stock lost over 10% of its value in just 24 hours during the latest tech selloff.
But it may take off again on Aug. 6.
That’s when . Another tech stock caught in the downdraft, ServiceNow (NASDAQ:NOW), bounced back overnight . SMCI may do the same.
SMCI was due to open this morning at about $693 per share, its market capitalization about $40.6 billion.
The Nvidia Trade
SMCI stock rose this year thanks to its relationship with Nvidia (NASDAQ:NVDA). SMCI sells racks of Nvidia GPUs to data centers, where demand has skyrocketed.
However, dependence on the artificial intelligence (AI) leader is a double-edged sword. SMCI stock was selling for nearly $1,200 per share in March. But quarter-to-quarter sales growth during that quarter. After those numbers came out on April 30, SMCI mostly traded sideways until the latest downdraft.
Fellow InvestorPlace contributor Thomas Niel recently suggested investors buy SuperMicro ahead of the release, as lowered estimates may be easier to beat. The view of traders at Stocktwits has turned , while analysts at TipRanks consider it .
Niel hoped that SMCI would pre-announce results before the official release date. But SMCI . It did, however, move up the delivery of its numbers . The lack of a pre-announcement may be contributing to bearish sentiment.
Analysts are hoping for in the June quarter, compared with a year ago. March quarter earnings were $6.56 per share.
SMCI Stock: What Happens Next?
Regardless of how the numbers come out, SMCI has been very, very good to investors lately. The stock was selling for under $270 as recently as last December, and nothing grows to the sky without a pullback.
As of this writing, Dana Blankenhorn had a LONG position in NOW. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor held a LONG position in NVDA.
