Will Super Micro Follow Nvidia's Lead With Stock Split?

Zinger Key Points
  • Analyst Eric Bleeker predicts Super Micro Computer may announce a stock split following Nvidia's lead, driven by high share prices.
  • Technical indicators for SMCI show short-term bearish trends but long-term bullish potential, making a stock split a strategic move.

With NVIDIA Corp‘s NVDA recent stock split announcement making waves, investors are speculating which tech giant might be next. Eric Bleeker of 24/7 Wall St. has identified Super Micro Computer Inc SMCI as a prime candidate for a split, citing several compelling reasons.

Anticipation Of Stock Split At Super Micro

Following Nvidia’s recent stock split, attention has turned to Super Micro as a potential candidate for a similar move. Eric Bleeker of 24/7 Wall St. provides three key reasons why Super Micro is likely to consider a stock split soon.

  1. Super Micro's shares have maintained elevated levels. Despite fluctuations, the stock has consistently traded near the $1,000 mark, making it one of the more expensive stocks in the technology sector. A stock split would make the shares more accessible to a broader range of investors without significantly lowering the price to uncomfortable levels.
  2. Super Micro is popular among retail traders, largely due to its strong performance in the AI sector. Retail investors often prefer owning whole shares rather than fractional ones, making a lower share price attractive. This preference could drive increased investor interest and liquidity.
  3. Historical trends show that stock splits can drive positive share returns. Companies like Nvidia, Amazon.com Inc AMZN, and Alphabet Inc GOOG GOOGL have seen significant stock increases following split announcements. A split could serve as a powerful catalyst for Super Micro, attracting more investors and boosting its stock price.

Also Read: Supermicro and AMD Roll Out Multi-Node Servers To Enhance Cloud Computing

Selling Pressure On Chart

Super Micro's recent stock performance has been marked by both bullish and bearish signals, providing a nuanced picture of its prospects. The stock is experiencing some selling pressure.

Chart: Benzinga Pro

The eight-day simple moving average (SMA) of $893.08 is above the current stock price, indicating a bearish signal. Similarly, the 50-day SMA of $893.21 is higher than the current price, reinforcing this bearish outlook.

The 20-day SMA of $842.65 suggests a bullish signal as the current price is above this average. The 200-day SMA stands at $531.45, indicating a long-term bullish trend since the stock price is well above this average.

Chart: Benzinga Pro

The Moving Average Convergence Divergence (MACD) indicator, with a value of 4.24, also suggests a bullish signal, indicating potential upward momentum.

The Relative Strength Index (RSI) is at 52.17, suggesting the stock is neither overbought nor oversold, but is just recently out of oversold territory.

Bollinger Bands analysis provides further insights. The current price is trading in the upper band, reinforcing the bullish signal.

With its high stock price, popularity among retail traders, and historical success of stock splits driving positive returns, Super Micro Computer appears poised for a potential stock split following Nvidia’s lead.

The technical indicators present a mixed but generally optimistic outlook, with long-term trends and MACD suggesting bullish potential despite short-term bearish signals.

Investors should closely monitor Super Micro's stock performance and news developments for further insights into its future trajectory.

Read Next: SMCI To Use S&P 500 Status To Raise Funds, Predicts AI Breakthroughs In Medicine, Weather Forecasting

Photo via Shutterstock.

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