With Super Micro Computer Stock Sliding, Have You Assessed The Risk?
Super Micro Computer (SMCI) stock is down 13.1% in 21 trading days. The recent slide reflects investor rotation from AI-linked stocks and SMCI’s execution risks and margin pressures, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where Super Micro Computer stands today.
- Size: Super Micro Computer is a $19 Bil company with $21 Bil in revenue currently trading at $31.66.
- Fundamentals: Last 12 month revenue growth of 11.9% and operating margin of 4.4%.
- Liquidity: Has Debt to Equity ratio of 0.17 and Cash to Assets ratio of 0.29
- Valuation: Super Micro Computer stock is currently trading at P/E multiple of 36.0 and P/EBIT multiple of 28.9
- Has returned (median) 30.9% within a year following sharp dips since 2010. See SMCI Dip Buy Analysis.
These metrics point to a Moderate operational performance, alongside Moderate valuation – making the stock Fairly Priced. For details, see Buy or Sell SMCI Stock
That brings us to the key consideration for investors worried about this fall: how resilient is SMCI stock if markets turn south? This is where our downturn resilience framework comes in. Suppose SMCI stock falls another 20-30% to $22 – can investors comfortably hold on? Turns out, the stock saw an impact slightly worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
2022 Inflation Shock
- SMCI stock fell 34.5% from a high of $35.33 on 7 August 2023 to $23.15 on 21 September 2023 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 19 January 2024
- Since then, the stock increased to a high of $118.81 on 13 March 2024 , and currently trades at $31.66
| SMCI | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -34.5% | -25.4% |
| Time to Full Recovery | 120 days | 464 days |
2020 Covid Pandemic
- SMCI stock fell 45.8% from a high of $2.95 on 5 February 2020 to $1.60 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 8 June 2020
| SMCI | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -45.8% | -33.9% |
| Time to Full Recovery | 82 days | 148 days |
2018 Correction
- SMCI stock fell 59.6% from a high of $2.89 on 4 January 2017 to $1.17 on 8 November 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 22 January 2020
| SMCI | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -59.6% | -19.8% |
| Time to Full Recovery | 440 days | 120 days |
2008 Global Financial Crisis
- SMCI stock fell 66.3% from a high of $1.14 on 5 June 2007 to $0.39 on 13 November 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 22 December 2009
| SMCI | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -66.3% | -56.8% |
| Time to Full Recovery | 404 days | 1480 days |
Feeling jittery about SMCI stock? Consider portfolio approach.
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