We recently published a list of Louis Navellier’s 10 Stock Picks with Huge Upside Potential. In this article, we are going to take a look at where Super Micro Computer, Inc. (NASDAQ:SMCI) stands against other Louis Navellier’s stock picks with huge upside potential.
Navellier & Associates is an independent money management firm founded in 1987 by renowned stock analyst Louis Navellier. Headquartered in Reno, Nevada, the firm has spent over three decades delivering disciplined, style-consistent investment strategies to both individual and institutional clients. Its core mission is to maximize returns while effectively managing excessive risk, offering customized portfolios built on a proprietary mix of quantitative and fundamental analysis. Distinct from firms that mimic market indexes, Navellier & Associates aims to outperform them, constructing portfolios that exhibit low correlation to standard benchmarks, greater diversification, and reduced overall volatility.
Navellier’s investment philosophy is based on a rigorous three-step, bottom-up stock selection methodology designed to identify inefficiencies and high-growth opportunities in the market. The first step in this process uses a proprietary quantitative screening system that evaluates market data and individual stock statistics, measuring risk through standard deviation and reward through alpha. This narrows the investment universe to stocks ranking in the top percentiles for favorable risk/reward characteristics. The second step employs fundamental analysis to target companies with strong earnings growth, healthy profit margins, and reasonable forward-looking price-to-earnings ratios. The third and final step involves a proprietary optimization model that strategically allocates portfolio holdings to maximize alpha and minimize volatility. This structured approach results in portfolios that are diversified across sectors and industries and are particularly suited for long-term investors aiming to achieve steady growth in varying market conditions.
Louis Navellier, the firm’s Founder, Chairman, Chief Investment Officer, and Chief Compliance Officer, continues to oversee the portfolios he helped originate. A highly respected voice in the financial community, Navellier has published quantitative growth stock research since 1980. His insights have been widely disseminated across CNBC, Fox Business News, Bloomberg, and MarketWatch, and he has been profiled in leading financial publications such as Forbes, Fortune, Barron’s, and The Wall Street Journal. His methodologies and career have also been spotlighted in books like Secrets of the Investment All-Stars and Investing Under Fire.
Navellier & Associates manages more than $1 billion in private and institutional assets and is a trusted resource for high-net-worth individuals and organizations. The firm offers personalized portfolio reviews that include detailed analysis, risk assessments, and tailored investment recommendations. Portfolio sizes range from $100,000 to over $100 million, and all investment decisions are uniquely customized to align with each client’s financial goals, preferences, and risk tolerance. This commitment to individualized service underscores the firm’s belief that every investor deserves a strategy tailored to their unique financial journey.
As of its latest 13F filing for the fourth quarter of 2024, Navellier & Associates reported managing approximately $834 million in securities. The firm’s top ten holdings represent 29.42% of the total portfolio, highlighting a focused yet strategically diversified investment approach rooted in decades of systematic analysis and seasoned market expertise.
Our Methodology
We searched through Navellier & Associates’ Q4 2024 13F filings to identify Louis Navellier’s stock picks with the highest upside potential. From the resultant data, we picked out the equities with upside potential higher than 50% based on analyst ratings and discussed why they stood out as sound potential investments. Finally, we ranked the stocks based on their respective price targets according to analysts. Additionally, we have mentioned the hedge fund sentiment around each stock using data from 1,009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A team of technicians in a server room, testing and managing the newest server solutions.
Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders as of Q4: 45
Navellier & Associates’ Equity Stake: $11.46 Million
Upside Potential as of April 23: 46.9%
Super Micro Computer, Inc. (NASDAQ:SMCI), commonly known as Supermicro, is an American information technology company headquartered in San Jose, California. It specializes in the design, development, manufacturing, and sales of high-performance server solutions based on modular and open-standard architectures. The company has become a key player in the technology hardware industry, with a market capitalization of approximately $23 billion by the end of December 2024. Supermicro’s innovative approach to server infrastructure, particularly in AI-driven platforms, continues to fuel its rapid expansion and strong financial performance.
For the second quarter of fiscal year 2025, which ended on December 31, 2024, Super Micro Computer, Inc. (NASDAQ:SMCI) reported impressive preliminary financials, primarily driven by surging demand for its AI-related systems. The company expects to report net sales between $5.6 billion and $5.7 billion, marking a 54% year-over-year increase at the midpoint. Gross margins, both GAAP and non-GAAP, are projected to fall between 11.8% and 11.9%. The company anticipates 5% year-over-year growth in diluted earnings per share, which are forecasted to be between $0.58 and $0.60.
At the end of the quarter, Super Micro Computer, Inc. (NASDAQ:SMCI) reported total cash and cash equivalents of approximately $1.4 billion, against total debt of $1.9 billion. Of this, around $200 million consists of bank debt, while the remainder comprises convertible notes. Looking ahead, the company projects net sales for the third quarter of FY2025 to range between $5.0 billion and $6.0 billion. It expects non-GAAP diluted earnings between $0.46 and $0.62, reflecting continued operational strength despite shifting macroeconomic conditions.
Supermicro recently revised its full-year 2025 revenue guidance to a range of $23.5 billion to $25 billion, down from its prior estimate of $26 billion to $30 billion. Despite this adjustment, the company maintains an ambitious long-term vision, targeting $40 billion in revenue for FY2026, an anticipated 65% year-over-year increase. Financial analysts remain bullish on the stock, with a price target of $48.33 and an implied upside potential of 46.9%. Super Micro Computer, Inc. (NASDAQ:SMCI) is hence listed as one of Louis Navellier’s top stock picks with huge upside potential.
Columbia Acorn Fund stated the following regarding Super Micro Computer, Inc. (NASDAQ:SMCI) in its Q3 2024 investor letter:
“Super Micro Computer, Inc. (NASDAQ:SMCI) had a tough quarter due to a confluence of negative events. It declined, but is still up significantly for the year. While demand for the company’s AI server racks remains strong, with revenue up over 100%, gross margins have fallen sharply for two straight quarters, implying a price war. In addition, Super Micro was the subject of a short-seller report and a delay in filing its annual report with the SEC. We have been taking profits in the stock all year and have only a small position, which we are maintaining given the strong performance and demand for Super Micro’s AI racks and a depressed stock valuation.”
Overall, SMCI ranks 7th on our list of Louis Navellier’s stock picks with huge upside potential. While we acknowledge the potential of SMCI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than SMCI but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
