Super Micro Computer
Membership has its privileges! Shares of Super Micro Computer (SMCI) are trading 18% higher this morning after Friday’s announcement that the newest AI name on the block would be added to the S&P 500.
The move further “discovers” this stock that has seemingly gone undiscovered as analyst and investors have been flocking to other names in the AI universe like Nvidia (NVDA) and Microsoft (MSFT).
Expect the index shift to put more analysts on the scent of SMCI’s potential, resulting in several coverage and price targets for the stock. The crowd is now fully engaged with this name, but it’s not too late.
Big Bear AI
I’m always a little afraid of following stocks that have taken a name JUST to get exposure to a trend, but Big Bear AI (BBAI) has still garnered the market’s attention.
This software developer falls under my classification of the “application” group for AI, along with companies like Salesforce.com (CRM) and IBM (IBM), meaning they will make money providing services built on AI innovations, not the technology itself.
Shares are 30% higher again today as the stock rips its way towards $5. I’m watching shares at $5 as it often acts as a trigger for profit-taking on stocks under $10. That’s when I would look to buy the dip on shares of BBAI.
IBM
I’d be remiss if I didn’t mention IBM here.
Shares of the AI service company are engaged in what I refer to as a “volatility rally” as they break through $190.
Volatility rallies happen after a stock finishes a “healthy correction” and consolidation, just as IBM shares have done over the last month.
The break above $190 is likely to draw more buyers to the stock as it approaches and breaks above $200. IBM’s earnings are slated for April 24, which is important because we should expect to see another “buy the news” rally on this early-stage AI stock.
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About the Author
Chris Johnson (“CJ”), a seasoned equity and options analyst with nearly 30 years of experience, is celebrated for his quantitative expertise in quantifying investors’ sentiment to navigate Wall Street with a deeply rooted technical and contrarian trading style.
