Artificial intelligence server company Super Micro Computers, Inc. (NASDAQ:SMCI) shares traded lower on Thursday in line with the broader semiconductor sell-off led by its customers, including Nvidia Corp (NASDAQ:NVDA) and Advanced Micro Devices, Inc (NASDAQ:AMD).

Despite the sell-off, analysts continue to tout Nvidia as the key AI player, suggesting that the AI ​​hype can continue. The sell-off has made the semiconductor companies’ valuations more attractive entry points.

Super Micro Computer stock has risen 136% over the past 12 months and is currently trading at a price-to-earnings ratio of 13.73. Nvidia, which has risen 176%, is currently trading at a P/E ratio of 33.16.

Recently, the Taiwanese supplier of rail kits Nan Juen International Coa partner of Super Micro Computer, has signed a deal with Nvidia to boost production of rail kits for GB200 AI servers.

According to TrendForce, the market value of AI servers could exceed $187 billion in 2024, representing a growth rate of 69%, driven by demand for advanced AI servers from large CSPs and brand customers.

The market potential for AI servers is driven by demand from Big Tech giants such as Nvidia, AMD, Amazon.Com Inc (NASDAQ:AMZN), Amazon Web Services and Meta Platforms Inc (NASDAQ: META) explains the development of the share price of Super Micro Computer.

Super Micro Computer reported 144% revenue growth in the fourth quarter. Analysts expected the AI ​​server company’s margin weakness to recover by fiscal 2025, leading to an easing of the competitive pricing environment.

Investors can participate in Super Micro Computer through Invesco QQQ Trust, Series 1 (NASDAQ:QQQ) and SPDR-S&P 500 (NYSE:SPY).

Price promotion: At last check on Thursday, SMCI shares were trading 2.77% lower at $606.50.

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This article, “What’s Happening to Super Micro Computer Stock on Thursday?” originally appeared on Benzinga.com

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