Super Micro Stock is MOONING | 3x Coming [SMCI Stock Moonshot]

hey is super micro computers going to 3x

from here in this video I'm going to

give you my opinion and my comparison of

this particular stock to Dell and what

Warren Buffett's personality says about

this particular situation uh but first I

want to show you this uh this is the

November 22nd Alpha report and I think

it's worth mentioning that I'm writing

this now and I'm writing that yesterday

we thought Nvidia was good enough and

profit taking might be Li lied and the

biggest beneficiary would be super

microcomputer well today what do we look

at looking back at yesterday Nvidia was

up 53 basis points The Q's were up 36

smci was up

15.12% you could literally see my

November 21 uh Alpha report which you

could get as well where I literally say

Nvidia earnings should be good enough uh

and that super micro is potentially the

play I'll pull to that portion here we

we go still a steal under $30 and it re

is reiterated by my previous uh Alpha

reports so I just want to say if you

want to get this sort of information

totally for free I'm getting ready to

send this one out 15 minutes before the

Market opens and there's a lot more

information in this you get them totally

for free all you have to do is go over

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okay let's now get into Dell versus

super micro computer so super micro

computer's obviously been undergoing

some um fraud considerations and we're

going to touch on those but what I'd

like to do first is look at the

valuation comparison so what I did is I

looked at the price to earnings ratio of

Dell 17.6 times versus super micro 9.5

times this suggests that on a price to

earnings basis Dell is selling for about

2x the valuation of Super Micro right

now on just a price to earnings basis

now Dell is expected to have some more

growth and that's because for some

reason in a few years Wall Street thinks

that super micro sales might slow and

turn negative for one year before

turning positive again when I've seen

this in the past I've actually seen

companies get around this by conducting

layoffs or some form of uh efficiency

protocols that end up keeping their

earnings in growth mode which could

totally expand the average growth rate

over the next four years for super micro

and the fraud allegations against super

micro might actually accelerate that

efficiency drive because now they've got

a massive microscope on them we'll touch

on that in just a moment but anyway

using current Wall Street projections

for growth over the next four years so I

take EPS now and look at the growth

average growth over the next four years

we get these values Dell growing a

little bit more which suggests on a PEG

ratio basis you do have super micro

trading for a discount on a price to

earnings basis uh earnings growth basis

compared to Dell at a discount of about

25% okay well if I give them 25% on top

of 35 bucks it's only a $37 stock it's

not much of a move right but that's

comparing to Dell and what's interesting

about Dell is Dell is very d Diversified

when you look at Dell server and storage

systems 8% represents artificial

intelligence and only 6% of the entire

company Revenue in 2025 is expected to

come from artificial intelligence so

makes it much less concentrated play the

only thing super micro computers does is

server recks and storage systems now

obviously part of that is data storage

so not AI but it is just a server and

data storage company rather than Dell

which is also a personal compute company

and so many other things that Dell does

networking you name it super micro

computer therefore might be a little bit

more of a concentrated play on the next

Frontier for artificial intelligence

expansion that next Frontier I believe

is actually going to look like a water

cooled future consider this when you pop

in over here you can see that air

cooling will never go away this is an

article from 2023 so it's about it's

actually just over a year old and they

talk about there's no doubt that

densities of server racks in reaching

the point uh or or are reaching the

point where some of them can no longer

be cooled efficiency efficiently with

air liquid cooling has a vast set of

benefits including increased efficiency

improved exclusion of dirt and dust

quieter operation and delivers waste

heat in a form where it can be used

elsewhere but still air cooling vendors

have a backlog of orders that have no

signs of diminishing great so a year ago

we're like hey we could still do air

cooled we could still do water cooled

but one of the problems that we're

running into now is you have overheating

concerns for the Blackwell transition

for NVIDIA chips and this overheating

issue now you know having the benefit of

another year of insight is being solved

by the announcement by people like

Michael Dell company Dell uh and super

micro who's also in this space what

they're doing is they're announcing

liquid cooled racks and they've been

already doing liquid cooled but even

better liquid cooled racks uh to help

support the latest and greatest Nvidia

chips so to me this suggests that water

cooling might actually rather than being

that it'll never go away might actually

become the most prominent next phase of

growth in artificial intelligence so it

won't necessarily be a way stronger llm

it'll actually be not next level Nvidia

price targets but rather hm in order to

support the growth of Nvidia and

nvidia's growth just even even even if

it's slower nvidia's growth even just

staying what it is or even slowing but

still delivering massive amounts from

its pip P line even if they had flat

revenues year-over year it's still a

massive amount of chips that they're

delivering that need to be installed you

need to now install these in yet another

revolution in AI that is the first

Revolution is oh my gosh gpus do AI

great everybody buys Nvidia Second

Revolution oh

uh we're doing the wrong racks we've

been using air cooling 90% of the time

only about 10% of server Rex right now

are water cooled oh we need all the new

ones to be water cool well that could

potentially be a game Cher for growth

trajectories for companies like super

micro or

Dell so then I went a little deeper and

I looked at the balance sheet of these

companies so from a debt coverage point

of view Dell only has about 47% of

coverage for all of their debt all right

what does that mean in English Okay well

just look at it here uh I've got about

$37 billion in total assets right here

but I'm going to remove these other

current assets because I don't really

know what those are uh so I'm just going

to call this $27 billion right here of

cash inventories and accounts receivable

at Dell and then I'm going to look at

I'm going to minus out deferred revenue

of $14 billion here I don't really see

that as a debt uh and so that gives me

over here I've got uh let's see here 6.7

in short-term debt 24 in accounts

payable 6.3 in acres uh that gives me

what does that give me 24 6.3 that gives

me about $37 billion right here I wrote

that down in current liabilities good

quick fact check then I've got uh

long-term debt here of another 2.7 in

non-current liabilities 17.8 right here

long-term debt I'm not going to consider

deferred revenue so I'm going to call it

another $20 billion so I've got $57

billion in debt $27 billion in cash

outside of deferreds and other current

assets right that only gives me a 47%

coverage of debts not great look at

Super Micro now it's possible all these

numbers are a fraud right and this is

back from March so it's dated because we

don't have the latest Financial so there

are risks here don't get me wrong but at

least from what we know then which again

could also be wrong but at least from

what we were told then 2.1 billion in

cash accounts receivable six Okay add

that together 2.1 1.6 inventories 4.1

because I gave Del their inventories as

well that's $7.8 billion okay fine what

do we have in debts well we're going to

remove deferred revenues and so we have

current liabilities of about

1.5 and then if I go down here I've got

term loans of $85 million I've got

convertibles and other long terms so I'm

just going to take everything except for

defer call it

3.5 uh that's total liabilities I don't

want Total I just want to add this up

over here so I'm going to go

1.7 plus other put in about another 0.15

for this other crap right here that

gives me debt of about $ 3.35 billion

all right well 7.8 / by 3.35 equal

2.3x so I could pay off my debt 2.3 *

over consider that Dell can only cover

47% of all their debt smci can cover all

of their debts uh

including uh their convertibles which I

mean those are just going to convert to

stock at some point this is why

convertibles are such a great offering

it's why we're doing that at hous Haack

by the way if you go to hous hack.com we

have an offering open right now read the

PPM over there this video is not a

solicitation but we have an offering

where you could actually get all the

upside in the stock as I try to build

this company to Prime for an IPO in the

long term and you get all the upside but

you also get downside protection in that

you're convertable Bond holder in the

meantime and you're earning 5% interest

paid out to you

monthly kind of

cool super micro can cover all of their

debts more than twice over 2.3x over so

in my opinion even if I took you know

$200 million for fraud or even $1

billion for fraud or even $2 billion for

fraud

charges uh if there is even fraud you

know it could just be a mistake at some

auditing problems or or just like bad

accounting and and some oopsy dupsies

but what ends up happening I still get

to cover all my debts you're still

getting the company cheap in my opinion

see Warren Buffett and well it's not

Warren Buffett it's um you know

Securities analysis it's more uh

Benjamin Graham but they talk about how

when companies undergo these accounting

controversies the stock price can

actually create one of the greatest

opportunities for buying because the

valuation just becomes grossly low and

so that's where I look at this stock I

go well if they get to $5 of eps in 2027

I give them a reasonable PE ra or Peg r

ratio of 1.67 at a 10% growth rate which

I think is low going forward I get an

$83 fair value for this

company and see the fraud allegations

are going to put a microscope on their

expenses when you have a microscope on

your expenses you're going to probably

cut costs and I don't think it's going

to affect their backlog because

companies who want to deploy Blackwell

might not necessarily help Nvidia stock

go higher because it's already so high

and expectations already so high but

could lead to more growth at companies

like d and super micro than than we're

already anticipating and the backlogs

are so large you know backlogs are

roughly Dell they're probably about a

year and a half out right now you know

those are likely to keep growing

especially if you have to transition to

water cool so it's a whole Revolution

after a revolution already started it's

like crap just built out all these air

cooled uh water uh you know air cooled

systems now we have to rebuild again to

water cool for the newest stuff

sucks for meta maybe that's why they're

you know stuck down 10% off a peak I

mean obviously the Stock's done very

well over time here but still it's kind

of interesting to think about so uh

that's just my take that's that's my

opinion so uh who knows I could be wrong

none of this is personalized advice but

you know I think this stock has a lot of

upside and I think most of the

accounting stuff is overblown now did I

say originally that hey I wouldn't touch

this with a 10 foot pull yeah but I said

that when the stock was trading for 48

to like $60 a share and it was really

before I went deep I'm like you know my

initial reaction is I wouldn't touch

this

company that was when I was $48 to $60 a

share then it got down to $18 and I'm

like bro this has got to be getting

close to book value and I look and it

was like under two times book I'm like

dude this is trading for like you know a

reat like a boring valuation uh I think

this is a cigar butt you know and then

when you look at my 2x two formula for

valuations pricing power is increasing

due to water cooling uh exceptional

fundamentals asteris fraud valuation

very low and the sentiment is

terrible this is like the best time to

buy when you meet your 2 by two

Foundation always build a 2 by two when

you play

Rust and get your Alpha report over at

me kevin.com Alfa it's totally free

check it out Meek kevin.com Alfa thanks

so much folks we'll see you soon bye do

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us here I feel like nobody else knows

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advertising and see how it goes

congratulations man you have done so

much people love you people look up to

you Kevin PA there financial analyst and

YouTuber meet Kevin always great to get

your take