Super Micro Computer (SMCI) and NVIDIA (NVDA) are top AI stocks, with SMCI focusing on dedicated AI servers and NVIDIA on data center GPUs. SMCI stock has risen more than NVDA in 2023 and 2024, leading to questions about which stock will continue to perform better.
SMCI has shown higher growth rates in terms of revenue and profit, with analysts expecting significant growth in fiscal 2024. On the other hand, NVDA struggled with stagnant revenue in fiscal 2023 but saw a substantial increase in fiscal 2024, driven by the generative AI market.
Looking ahead, analysts predict that SMCI will outpace NVDA in revenue growth over the next few years. SMCI also has greater growth potential with only 10% of the AI dedicated server market share, expected to grow to 17% in the next three years.
Additionally, SMCI benefits from partnerships with both NVDA and Advanced Micro Devices, diversifying its offerings and reducing dependency on a single supplier. NVDA, while dominant in the discrete GPU market, may face challenges in sustaining growth compared to SMCI.
Furthermore, SMCI’s lower valuation compared to NVDA makes it an attractive investment option, with room to run before being considered overvalued. NVDA, on the other hand, appears more expensive relative to other chip and AI stocks.
Overall, both SMCI and NVDA remain strong long-term AI investments, but SMCI is poised to outperform NVDA in the near future due to its growth potential, partnerships, and lower valuation. Investors should consider the unique strengths of each company and their positioning in the AI market before making investment decisions.
Article Source
https://finance.yahoo.com/news/3-reasons-super-micro-computer-181500261.html
