Bearish case for SMCI!
$SUPER MICRO COMPUTER INC(SMCI)$
Bearish case for SMCI:
The news about TSMC was IMHO a bad one for hardware-AI firms. TSMC orders went up 30% on an annualized basis and the C-suite gave an outlook that AI orders are expected to grow at 50%. Analyst expectations of growth for $NVIDIA Corp(NVDA)$ and SMCI for next year are well above 50% (around 80%ish), suggesting that the stock price will eventually bake in this piece of information eventually, resulting in a decline.
Moreover, the Fed's fight with inflation is less effective as the stock market keeps rising, generating spending opportunities for consumers even though their income does not rise as fast. My point is, the Fed will likely increase the interest rates to the point where the stock market does not end up having rallies that might not be justified by fundamentals. As a result, macro forces are unlikely to provide tailwinds for SMCI.
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