What’s Better Than SMCI Stock?

I don’t know if you know this, but I recommended Super Micro Computer Inc. (SMCI stock) way back in 2020 before pretty much anybody had even heard of the company. Back then, SMCI stock was going for a little less than $30 per share. But I knew it had the potential to be a much bigger company. You see, even before then, I’d been getting very interested in a new technological frontier called generative artificial intelligence, or genAI. And right now I’m recommending another company most people haven’t heard of. Because I’m convinced it’s got even more potential than SMCI stock did back in 2020 when I advised investors to buy as much of it as they could afford.

But before we get into the company I’m convinced has even more AI potential than SMCI stock did back in 2020, you need to know what got me so excited about SMCI stock all those years before it became a mainstream theme.

How I Found SMCI Stock

If you’ve been reading these pages for any length of time, you know I come from Wall Street. I cut my teeth, so to speak, in the back offices of Morgan Stanley’s fixed income department. And after “paying my dues” for a bit, I moved my way up the ladder to manage a team that covered several billion dollars’ worth of trading every day. And I still have a lot of friends from back in those days when we were all young and climbing the corporate ladder. Most of us left Wall Street to pursue other financial callings. Mine was helping retail investors like you. But a lot of them got into venture capital and private equity, two very lucrative professions when you’re good at them.

So when my friends and I get together, the conversation always drifts back to the financial markets. We always avoid saying anything that could get ourselves or our friends into trouble. But we like to share the investment themes and trends we’re watching with each other after a few mojitos on the deck. And back in the late “20-teens,” I was talking to some of those friends in the venture investing and private equity world at a wedding we were all attending. And what struck me was how excited they were about artificial intelligence.

As soon as I got home, I started looking into the trends and technological advances they were talking about. And my mind was blown with how far things had come. On Wall Street, we used a type of AI, but all it could do was examine past data and make a prediction about the future. This stuff could learn from the data and actually generate new information from it. But every single company that was working on it was saying that they needed better places to store their data. The data centers of 2020 just weren’t built to handle the load AI was putting on them. And that’s how I first found SMCI stock.

Why I Loved SMCI Stock

I was looking for smaller companies that were working on building more advanced solutions for data storage. Because I knew that the data centers of the world were going to need to do trillions of dollars’ worth of upgrades if they wanted to retain the companies using AI as customers. Of course, Nvidia was working on those in its data center department. But I’d already recommended investing in Nvidia back in 2019, when it was still trading at a split-adjusted $3.70 a share. It’s worth $135 after the 10-for-1 split. And, just like SMCI stock did, it’s delivered some pretty blockbuster returns since then, too.

But since then, SMCI stock has cooled off as investors realized they’d driven the value up a little bit too high. There are trillions of dollars’ worth of upgrades to do. But only a few companies had really committed to them until this year. And those upgrades take several years to complete. So those profits are going to be spread out over several years. My investors still got a shot at a 4,000% gain, so I’m not complaining. But it did make me think a little bit about those upgrades. And it got me thinking about the companies that had already started making them back when I was first learning about the need. And that’s what led me to the stock I’m convinced is going to be even better for investors than SMCI stock…

What’s Better Than SMCI Stock?

You see, not many companies saw the writing on the wall. Most of them waited until last year or this year to really start taking genAI and its data load seriously. But there was one that really stood out when I was researching. It started upgrades far earlier than its competitors. So while they’re just getting started, this company is about ready to wrap up work. Now it’s almost got a monopoly on the AI data storage market. It’s the same kind of early-mover advantage that led me to SMCI stock. And I’m convinced this one could be even better because it’s got a very generous business model for its investors. This company shares nearly all of the profits it brings in with investors on a three-month basis. I’m talking about nearly every penny. What it doesn’t pay to investors, it uses to expand operations. But since it’s so far ahead of the competition, it’s been able to pay investors almost $800 million this year alone.

I call it the “tollbooth” because it offers access to the information superhighway AI companies need — for a fee. And it shares that fee with investors like us. That’s something I’d like to see more companies do. But I also love it for the same reasons I loved SMCI stock, too. It’s an early mover and has a near monopoly on a lucrative market. In fact, I actually like this one so much more than I liked SMCI stock back in 2020, I did something I never did with SMCI stock… I wrote a special report I could circulate to explain the situation I saw unfolding and the profit potential of companies like the tollbooth. I’d like to share that report with you today because I really do think that this company could be even better for investors than I thought SMCI stock would be back in 2020. And we all know how that one played out.

To your wealth,

Jason Williams

@TheReal_JayDubs

Angel Research on Youtube

After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of Main Street Ventures, a pre-IPO investment newsletter; the founder of Future Giants, a nano cap investing service; and authors The Wealth Advisory income stock newsletter. He is also the managing editor of Wealth Daily. To learn more about Jason, click here.

Want to hear more from Jason? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on.