With $20K to invest, debating between Super Micro Computer and Intel—what’s the smarter move?

Investing

Published: February 11, 2025 11:08 am

Last Updated: February 11, 2025 11:22 am

Investors have been piling into artificial intelligence stocks. All because of its game-changing potential and significant market valuation. In fact, according to Grand View Research, the global AI boom could grow from about $137 billion in 2022 to more than $1.81 trillion by 2030.

Key Points About This Article

According to Grand View Research, the global AI boom could grow from about $137 billion in 2022 to more than $1.81 trillion by 2030, which is great news for AI-related stocks like Super Micro Computer and Intel.
Super Micro Computer rallied after the company announced full production availability of its end-to-end AI data center solutions accelerated by Nvidia’s Blackwell platform.
Intel dominates the central processing units (CPU) market. Unfortunately, it has fallen behind in the artificial intelligence chip war against titans like Nvidia.
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Meta Platforms (NASDAQ:META) is boosting its capital expenditures for 2025, aiming for about $60 billion to $65 billion. Most of that will be directed towards enhancing its AI capabilities. Microsoft (NASDAQ:MSFT) announced a $3.3 billion investment to build an AI hub.

We’ll also see more demand for AI from The Stargate Project, which plans to invest up to $500 billion in AI infrastructure in the U.S. by 2029.

In short, there’s plenty of potential ahead for AI stocks

Unfortunately, not all AI-related companies have reaped the rewards, including Super Micro Computer (NASDAQ:SMCI) and Intel (NASDAQ:INTC). Since peaking in 2024, SMCI is now down 65%. Intel is down about 60%.

The good news, for both, is that a good deal of negativity has been priced in.

But which one should you buy with $20,000 to invest? Let’s find out.

The Case for Super Micro Computer

Over the last few days, Super Micro Computer rallied from about $25.71 to a recent high of $42.65. This occurred after the company announced full production availability of its end-to-end AI data center solutions accelerated by Nvidia’s (NASDAQ:NVDA) Blackwell platform.

“Supermicro has the expertise, delivery speed, and capacity to deploy the largest liquid-cooled AI data center projects in the world, containing 100,000 GPUs, which Supermicro and NVIDIA contributed to and recently deployed,” said Super Micro CEO Charles Liang, in November, as quoted by Seeking Alpha.

While the stock was taken down on a short report from Hindenburg, that negativity has been priced in. Helping, the company did bring in a new auditor, and indicated it will not have to restate any of its financials. We also have to consider that Super Micro’s AI server market is expected to grow about 18% CAGR to $177.4 billon by 2032. Plus, with growing demand for AI infrastructure, SMCI servers and storage solutions are well-positioned to benefit.

The Case for Intel

Intel dominates the central processing units (CPU) market. Unfortunately, it has fallen behind in the artificial intelligence chip war against titans like Nvidia.

And it’s now struggling to catch up. Not helping, Intel’s $10 billion cost reduction program and its plan to cut 15% of its workforce did very little to reassure investors. Even Pat Gelsinger resigned as CEO because of a disastrous tenure. With that, depending on who heads Intel moving forward, the company could see massive changes ahead, adding to uncertainty.

Intel also lost its head of data center and artificial intelligence operations, Justin Hotard, as it continues to struggle to revamp the business. Reportedly, Hotard is leaving Intel to take the helm at Nokia. Unfortunately, that’s to be expected with Intel falling so far behind in the AI market. Worse, Intel cut its dividend. It’s losing CPU market share to Advanced Micro Devices (NASDAQ:AMD), as margins crumble.

And it’s miles behind in the AI market, which it may not catch up with.

In short, there’s no real reason to get bullish again on Intel. It’s going through a transitional period as it searches for new leadership. It’s losing ground in the CPU market. It missed the AI GPU market boom and it’s not likely to catch up any time soon. It really missed the boat.

At the Moment, Super Micro is the Better Bet

That being said, we’d invest $20,000 in Super Micro Computer, as it just starts to pivot higher.

Helping, analysts at CFRA just upgraded SMCI to a buy with a $48 price target. The firm argues that SMCI’s near-term margin recovery and market share gains are likely given its “proven rapid development capabilities and expanding product portfolio,” added Business Insider.

Plus SMCI’s “dominant” position in liquid cooling and advantage with Nvidia’s Blackwell B200 solutions really showcases its leadership in AI infrastructure.

Again, with $20,000, we’d invest it in Super Micro Computer today.