Leung Chan, a director at
Super Micro Computer (SMCI), recently bought 3,000 shares. The buy increased the director’s holdings by 12 percent, and came to a total cost of $256,440.
The director was the last buyer of shares in November, picking up 1,525 shares for $127,338. Generally, company insiders have been sellers of shares, particularly a director and the company CEO, who both own substantial holdings.
Overall, insiders own 13.3 percent of shares.
The computer server and storage producer has seen shares soar 136 percent in the past year. That’s thanks to revenues rising 54 percent and earnings expanding by 320 percent. The growth has been fueled in part by higher-margin products like the company’s security software.
Shares currently trade at under 10 times earnings. And while that growth may slow, SMCI’s low market cap still leaves it with ample room for growth in the years ahead.
Action to take: Investors may like shares for the long haul at or under current prices. The company is still in its early growth stages, so it doesn’t pay a dividend yet.
For traders, shares are likely to continue their long-term uptrend. The May $100 calls, last going for about $7.85, offer mid-double-digit returns in the months ahead on a further rally for SMCI shares.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.