Ignoring all the geopolitical issues, trump tariffs and SMCI shit news, $75 is a 2x-3x return from lows. Buybuybuy while we can! [Cool] [Cool] [Cool]
1. Key Inputs from the Latest Announcement
• Q4 FY26 Preliminary Revenue: $11.0B (at the low end of $11.0B–$12.5B guidance).
• Gross Margin: 15.0% – 17.0% (vs. previous guidance of 8.2%–8.4%).
• New Orders Intake: >$60 Billion in Q4 alone, pushing backlog to record highs.
• Share Count: ~580M to 600M diluted shares (reflecting recent capital raises).
2. Updated Earnings Power Model (FY2027 Run-Rate)
Previously, Wall Street modeled SMCI as a low-margin assembler (~8% to 10% gross margins) producing thin operating margins (~4% to 5%).
If SMCI maintains a 12% to 14% normalized gross margin (conservatively assuming Q4's 15%–17% was a favorable mix peak that settles slightly lower), its bottom-line earnings power expands dramatically.
3. Fair Value Target Matrix
Historically, SMCI trades at a discount to peers like Dell and HPE due to corporate governance overhangs and margin volatility.
• Historical/Discounted P/E Multiplier: 8x – 10x forward earnings
• Peer Group Benchmark (Dell/HPE): 12x – 15x forward earnings
• Pure-Play AI Growth Multiplier: 16x – 20x forward earning
Target Valuation Summary
• Prior Stock Price (Pre-Announcement): ~$24.00 – $25.50
• Post-Announcement Pre-Market Price: ~$30.00 – $31.00 (+18% to +20% jump)
• Estimated Fundamental Fair Value: $65.00 – $75.00
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