Needham & Company Cuts Price Target on Super Micro Computer (SMCI) Following 1Q16 Pre-Announcement

Needham & Company maintained a Buy rating on Super Micro Computer (NASDAQ: SMCI), and cut the price target to $41.00 (from $43.00), following pre-announced 1Q16 results. The company now expects revenue to be within the $529-530M range vs. prior guidance for $520-580M. Non-GAAP EPS was also revised lower and is expected to be within the range of $0.44-0.45 vs. prior $0.49-0.59. The company will announce its Q1 results on Thursday, October 22, 2015 at 5pm EST.

Analyst Richard Kugele commented, "It has been a challenging 2015 for fans of SMCI, with strong quarterly results and meaningful penetration into the storage market earlier in the year marred by a series of one-off missteps/issues recently. While each of these has passed with time (from the inventory issues, to customer pushouts to the marketing accounting issue), the culmination has weighed on credibility and investor confidence. Last night's negative pre-announcement does nothing to allay these fears, nor does the lack of meaningful color as to the reason for the shortfall. For now, we take the pushout, greater seasonality, and weakness in Asia and Europe at face value, but we note that even our patience is wearing and improved execution is required. Maintain Buy with target now $41 vs. $43 on consistent multiple of 17.5x our revised F16 estimate of $2.32."

For an analyst ratings summary and ratings history on Super Micro Computer click here. For more ratings news on Super Micro Computer click here.

Shares of Super Micro Computer closed at $31.82 yesterday.

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