- Jim Cramer on Silicon Motion: “You Buy Some, and Then You Wait for a Pullback”
May 17, 2026
Silicon Motion Technology Corporation (NASDAQ:SIMO) was among Jim Cramer’s Mad Money stock calls as he urged investors to exercise caution when it comes to red-hot AI stocks. When a caller asked about the stock, Cramer stated:
That is called SIMO… And we like SIMO. I know it’s moved a lot. So what you do in these is you buy some, and then you wait for a pullback. But you gotta put some on, and I think it’s a good call by you.
Photo by Adam Nowakowski on Unsplash
Silicon Motion Technology Corporation (NASDAQ:SIMO) develops and markets NAND flash controllers and specialized storage solutions for various applications, including computing, enterprise data centers, and mobile devices. Heartland Advisors stated the following regarding Silicon Motion Technology Corporation (NASDAQ:SIMO) in its Q1 2026 investor letter:
An example is Silicon Motion Technology Corporation (NASDAQ:SIMO). A year ago, shares of the leading maker of memory components used in PCs, smartphones, data centers, and industrial and auto applications sold off amid a variety of concerns. They included tariffs, consumer spending worries, and questions over whether investors might be overestimating the capex needs of large-scale cloud service providers known as hyperscalers. At the time, we remained committed to the stock because we believed the company was in the early days of a re-rating process, as SIMO had been making a push away from trailing-edge, lower-margin consumer electronics into higher-margin, leading-edge applications driven by hyperscaler demands.
What a difference a year makes. In the first quarter, the stock was a contributor to our outperformance, as consumer spending has held up and hyperscalers continue to indicate robust datacenter capex growth. In their fourth-quarter conference call, management reiterated the firm’s outlook for their PC and smartphone end markets and the growth prospects for their data center storage components, which are expected to drive margins substantially higher.
Yet in our opinion, SIMO remains meaningfully undervalued versus our current price target. The stock currently trades at $117, but we believe the company should be valued at $185. That’s based on a multiple of 15X EBITDA plus an anticipated $160 million cash settlement from SIMO’s ongoing arbitration with MaxLinear surrounding the termination of a proposed merger agreement more than two years ago.
While we acknowledge the potential of SIMO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years
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- Jim Cramer spots hidden upside in a surging chip stock
May 16, 2026
There's a certain kind of stock that makes even seasoned investors do a double-take. It's already up big, so big that the instinct is to assume the easy money is gone. Then someone like Jim Cramer steps in and reframes the whole conversation.
On CNBC's Mad Money Lightning Round, Cramer didn't shy away from Silicon Motion Technology (SIMO).
"We like SIMO," he said. "I know it's moved a lot. What you do with these is you buy some, and then you wait for a pullback."
That's a nuanced take and not actually a reckless chase, but a disciplined entry strategy for a stock that has clearly found its footing. And when you dig into what Silicon Motion just reported, the enthusiasm starts to make a lot more sense.
CEO Wallace Kou had already laid out the bull case plainly in the company’s first quarter 2026 statement.
"Our investments in share gains across all our markets and expansion into new enterprise and AI opportunities are taking hold and are already creating strong tailwinds for growth this year and beyond," he said.
Silicon Motion's explosive Q1 results stopped Wall Street in its tracks
Silicon Motion reported Q1 2026 net sales of $342.1 million, up 23% quarter-over-quarter (QoQ) and up 105% year-over-year (YoY), according to a company statement. That kind of double-century YoY growth doesn't happen on momentum alone. It requires fundamental business acceleration.
The segment breakdown tells the real story:
eMMC and UFS controller sales: up 30% to 35% QoQ and up 140% to 145% YoY Ferri and Boot Drive solutions: up 205% to 210% QoQ and up 755% to 760% YoY SSD controller sales: down 5% to 10% QoQ but still up 40% to 45% YoY
Source: Silicon Motion first quarter of 2026 earnings results
I crunched the numbers on what the Ferri and Boot Drive surge means in context. That segment didn't just grow, it nearly tripled sequentially. That's the kind of move that suggests a new product cycle hitting an inflection point, not a one-quarter blip.
On the bottom line, GAAP net income came in at $66.8 million, or $1.97 per diluted American depositary share (ADS), and up from $47.7 million, or $1.41 per ADS, in Q4 2025, according to the earnings statement. Non-GAAP EPS rose to $1.58 from $1.26 in the prior quarter.
Gross margin, operating margin, and revenue all came in ahead of the company's own expectations, according to Kou's statement.If Silicon Motion hits the midpoint of Q2 guidance, it will have roughly doubled revenue in back-to-back quarters on a YoY basis.LightRocket via Getty Images
The edge AI and enterprise push that makes SIMO more than a smartphone story
Here's what the headline numbers don't fully capture. Silicon Motion is quietly repositioning itself from a mobile-focused chip supplier into an enterprise and AI infrastructure player, and the early results are showing up in the financials.
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The company is ramping up several new products across its business lines in 2026:
A new four-channel PCIe Gen 5 edge SSD controller targeting high-performance storage Multiple new embedded eMMC and UFS controllers for mobile, IoT, and automotive markets New Ferri automotive programs are scaling in volume MonTitan enterprise-class controllers and boot drive storage solutions are aimed at data center customers
Source: Silicon Motion first quarter of 2026 earnings results
Kou described 2026 as "a defining year" in the company statement, a phrase management rarely uses unless the pipeline visibility is real. The backlog supports that confidence. Silicon Motion has already sold more in Q2 than the Q1 backlog implied, and management is guiding for sequential growth throughout the rest of the year.
The eMMC and UFS outperformance is particularly notable. Those controllers grew 140% YoY despite weakening smartphone sales. Also, a signal that market share gains, not end-market tailwinds, are doing the heavy lifting, according to Kou.
Silicon Motion's Q2 guidance points to another record quarter
Management guided Q2 2026 revenue between $393 million and $411 million, up 15% to 20% QoQ and up 98% to 107% YoY. At the midpoint, that's roughly $402 million. Non-GAAP gross margin is expected to come in between 48.5% and 49.5%, with non-GAAP operating margin between 21% and 22%.
My review of the trajectory is this. If Silicon Motion hits the midpoint of Q2 guidance, it will have roughly doubled revenue in back-to-back quarters on a YoY basis. And that’s a run rate that puts the full-year story in a different category entirely.
More AI:
Micron sits at the center of a red-hot chip rally IBM CEO sends blunt message on AI and quantum computing Anthropic CEO makes shocking admission about AI
SIMO shares closed at $259.99 on May 15, up 189.10% year-to-date and 332.83% over the past year, according to Yahoo Finance data as of May 16, 2026. The MSCI World index returned 7.02% and 22.73% over those same periods.
Cramer's playbook is to buy some now and wait for a pullback to add more. This reflects a stock where the fundamentals are clearly working, but the move has been sharp enough that patience still has value. If you are a watching investor, the Q2 report now becomes the next real test of whether Silicon Motion's AI and enterprise expansion is as durable as management believes. The Ferri and Boot Drive numbers suggest it might be even bigger.
Related: Qualcomm stock gets harsh reality check after semiconductor rally
This story was originally published by TheStreet on May 16, 2026, where it first appeared in the Investing section. Add TheStreet as a Preferred Source by clicking here.
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- Wall Street Analysts Think Silicon Motion (SIMO) Is a Good Investment: Is It?
May 15, 2026
When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?
Let's take a look at what these Wall Street heavyweights have to say about Silicon Motion (SIMO) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Silicon Motion currently has an average brokerage recommendation (ABR) of 1.09, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 11 brokerage firms. An ABR of 1.09 approximates between Strong Buy and Buy.
Of the 11 recommendations that derive the current ABR, 10 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 90.9% and 9.1% of all recommendations.
Brokerage Recommendation Trends for SIMOBroker Rating Breakdown Chart for SIMO
Check price target & stock forecast for Silicon Motion here>>>
The ABR suggests buying Silicon Motion, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
ABR Should Not Be Confused With Zacks Rank
Although both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.
The ABR is calculated solely based on brokerage recommendations and is typically displayed with decimals (example: 1.28). In contrast, the Zacks Rank is a quantitative model allowing investors to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
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It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
There is also a key difference between the ABR and Zacks Rank when it comes to freshness. When you look at the ABR, it may not be up-to-date. Nonetheless, since brokerage analysts constantly revise their earnings estimates to reflect changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in predicting future stock prices.
Should You Invest in SIMO?
Looking at the earnings estimate revisions for Silicon Motion, the Zacks Consensus Estimate for the current year has increased 46.7% over the past month to $8.37.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #1 (Strong Buy) for Silicon Motion. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for Silicon Motion may serve as a useful guide for investors.
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Silicon Motion Technology Corporation (SIMO) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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- Wall Street Analysts Think Silicon Motion (SIMO) Is a Good Investment: Is It?
May 15, 2026 · zacks.com
When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?
- Is Silicon Motion Technology the Next Sandisk?
May 15, 2026 · fool.com
Silicon Motion Technology's NAND flash controllers are like the directors that make sure NAND flash chips like the ones Sandisk produces do their job. The company had substantial sequential growth while delivering a blowout forecast.
- Are Memory Specialists a Better Way to Play the AI Boom Than AI Chipmakers?
May 12, 2026 · fool.com
If you missed out on the AI chip boom, the memory space could be a second chance to profit.
- A Look at Silicon Motion Technology Corp (SIMO) After 3.3% Gain -- GF Value $101.28 vs Price $262.05
May 12, 2026 · gurufocus.com
On May 11, 2026, Silicon Motion Technology Corp (SIMO) shares rose 3.3% today, bringing the current price to $262.05. The stock has experienced significant pric
- Is It Too Late To Consider Silicon Motion Technology (SIMO) After 352% One-Year Surge?
May 11, 2026
Get insights on thousands of stocks from the global community of over 7 million individual investors at Simply Wall St.
If you are wondering whether Silicon Motion Technology at US$253.59 is priced for opportunity or already reflects high expectations, the starting point is to understand what the current valuation is actually telling you. The stock has posted strong returns, with gains of 11.6% over 7 days, 100.1% over 30 days, 170.5% year to date and 352.5% over the past year, which naturally raises questions about how much value is left on the table versus how much risk has been priced in. Recent headlines around Silicon Motion Technology have focused on its positioning within the semiconductor sector and how investors are responding to that context through the share price. This mix of sector attention and shifting sentiment helps explain why the stock has moved so sharply over multiple time frames. Despite those strong returns, Silicon Motion Technology currently records a value score of 1 out of 6. The key question is which valuation methods best capture its current risk reward trade off, and what additional lens later in this article can help you assess whether the market is being too cautious or too optimistic.
Silicon Motion Technology scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
Approach 1: Silicon Motion Technology Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model takes estimates of a company’s future cash flows and discounts them back to today using a required return, to arrive at an estimate of what the business could be worth now.
For Silicon Motion Technology, the model used is a 2 Stage Free Cash Flow to Equity approach based on cash flow projections in $. The latest twelve month free cash flow is a loss of $84.50 million. From there, analysts and extrapolations point to free cash flow of $88.33 million in 2026 and $334.27 million in 2028, with figures extended out to 2035 using Simply Wall St estimates.
After discounting these projected cash flows, the model arrives at an estimated intrinsic value of $145.34 per share, compared with the current share price of $253.59. That gap implies the stock is about 74.5% above the DCF estimate, which indicates that a lot of optimism is already reflected in the price according to this model.
Result: OVERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Silicon Motion Technology may be overvalued by 74.5%. Discover 49 high quality undervalued stocks or create your own screener to find better value opportunities.
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SIMO Discounted Cash Flow as at May 2026
Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Silicon Motion Technology.
Approach 2: Silicon Motion Technology Price vs Earnings
For a profitable company, the P/E ratio is a useful way to see how much you are paying for each dollar of earnings, which is often how many investors think about valuing a stock in practice.
What counts as a “normal” or “fair” P/E depends on how fast earnings are expected to grow and how risky those earnings are. Higher expected growth or lower perceived risk can justify a higher P/E, while slower growth or higher risk usually points to a lower multiple.
Silicon Motion Technology currently trades on a P/E of 50.70x, compared with a Semiconductor industry average of 59.84x and a peer average of 33.28x. Simply Wall St’s Fair Ratio for the stock is 46.83x, which is its proprietary estimate of an appropriate P/E once factors such as earnings growth, profit margins, industry, market cap and company specific risks are taken into account.
This Fair Ratio approach goes further than simple peer or industry comparisons because it adjusts for the fact that not all companies in the same sector have the same growth profile, risk level or profitability.
Since Silicon Motion Technology’s current P/E of 50.70x is above the Fair Ratio of 46.83x, the stock looks overvalued on this measure.
Result: OVERVALUEDNasdaqGS:SIMO P/E Ratio as at May 2026
P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 19 top founder-led companies.
Upgrade Your Decision Making: Choose your Silicon Motion Technology Narrative
Earlier it was mentioned that there is an even better way to understand valuation, so this is where Narratives come in, giving you a simple story that links your view of Silicon Motion Technology to a forecast and then to a fair value that you can compare with the current price.
A Narrative on Simply Wall St is your own explanation for the numbers. You spell out what you think will happen to revenue, earnings and margins, and the platform then turns that story into a financial model and a fair value estimate that sits alongside the latest share price so you can decide whether the stock looks expensive or cheap on your terms.
Narratives are available on the Community page and are designed to be accessible. The system automatically updates forecasts and fair values when new information is added, such as news or earnings, so your story and numbers stay aligned without extra work from you.
For Silicon Motion Technology, one investor might build a bullish Narrative around analyst fair value of US$180.00 with faster growth and higher margins. Another might lean on the more cautious US$65.00 view, and by comparing each Narrative fair value with the current price you can quickly see which story lines up best with your own expectations and risk tolerance.
Do you think there's more to the story for Silicon Motion Technology? Head over to our Community to see what others are saying!NasdaqGS:SIMO 1-Year Stock Price Chart
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include SIMO.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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- Silicon Motion (SIMO) Shares At An All-Time High Following Robust Q1 2026 Results
May 11, 2026
Having reached its all-time high of $230.00 on May 1, 2026, Silicon Motion Technology Corporation (NASDAQ:SIMO) secured a spot on our list “Sizzling returns: 7 tech stocks that just hit new all-time highs”. The stock has gained 180.33% so far in 2026 as of May 8, 2026.Silicon Motion (SIMO) Shares At An All-Time High Following Robust Q1 2026 Results
Oleksandr Lysenko/Shutterstock.com
That record-breaking run for Silicon Motion Technology Corporation (NASDAQ:SIMO) followed the strong Q4 2025 results reported earlier in the year.
Surpassing its $1 billion annualized run rate target with a gross margin of 49.2% and EPS of $1.26, the company reported revenue of $278.5 million, reflecting 15% sequential growth and over 45% year-over-year growth.
Having reported those numbers, management maintained a confident outlook and guided to counter-seasonal Q1 2026 growth.
Heading into Q1 2026, management had already called for counter-seasonal growth; mobile share gains were accelerating as NAND makers pulled back from the consumer market, boot drive shipments to a major AI GPU maker had commenced, and MonTitan qualifications were well underway.
That setup laid a strong foundation for the robust Q1 2026 results released on April 30.
Silicon Motion Technology Corporation (NASDAQ:SIMO) delivered a record $342.1 million in revenue, up 23% sequentially and 105% year-over-year. The quarterly performance also featured a gross margin of 47.2% and EPS of $1.58, sending shares 45% higher to an all-time high.
With analysts responding positively, Wall Street took notice.
Craig-Hallum lifted its price target on Silicon Motion Technology Corporation (NASDAQ:SIMO) to $250 from $160 and maintained its “Buy” rating, arguing that the risk-reward profile remains compelling even after the surge. Amid MonTitan’s ramp-up, Craig-Hallum highlighted the company’s datacenter business, citing share expansion and rising ASPs as structural demand drivers.
Management looks ahead with optimism, with its Q2 2026 guidance of $393–$411 million implying 15%-20% sequential growth.
Silicon Motion Technology Corporation (NASDAQ:SIMO) develops and markets NAND flash controllers for solid-state storage devices, as well as SSDs, microSD, and embedded storage solutions, serving global consumer and enterprise markets.
While we acknowledge the potential of SIMO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years. Disclosure: None. Follow Insider Monkey on Google News.
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- Wedbush Lifts PT on Silicon Motion Technology Corp. (SIMO) on Back of Substantial Beat and Raise
May 7, 2026
Silicon Motion Technology Corp. (NASDAQ:SIMO) is one of the top semiconductor stocks in our ranking of the top 10 chip stocks by YTD performance. Wedbush lifted the price target on Silicon Motion Technology Corp. (NASDAQ:SIMO) to $230 from $180 on April 30, reaffirming an Outperform rating on the shares. The rating update came on the back of the company’s substantial beat and raise, with the firm heading into this quarter looking for a modest beat and an in-line guide.Micron Reportedly Planning ¥1.5 Trillion HBM Fab in Hiroshima Amid Rising AI Demand
Wedbush told investors that while it expected share gains, and particularly momentum in the China market, would likely allow Silicon Motion Technology Corp. (NASDAQ:SIMO) to surpass its initial guide, the firm did not anticipate a notable deviation from management’s prior full-year outlook. It believes what the company provided instead was a significant beat, followed by a massive upward guide driven by strength across the company’s business units.
Silicon Motion Technology Corp. (NASDAQ:SIMO) also received a rating update from Craig-Hallum the same day. The firm lifted the price target on the stock to $250 from $160 and maintained a Buy rating on the shares, noting that the stock was up 45% on the strong print. However, the firm continues to like the risk-reward owning shares and the company’s datacenter business, with a market-leading solution, is just now ramping.
Silicon Motion Technology Corp. (NASDAQ:SIMO) develops, manufactures, and supplies semiconductor products for the electronics market. Its products include Storage Solutions, Flash Controllers, and others. The company offers embedded graphics, embedded and expandable storage, and radio frequency integrated circuits. It was founded in 1995 and is headquartered in Hong Kong.
While we acknowledge the potential of SIMO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 15 Stocks That Will Make You Rich in 10 Years AND 12 Best Stocks That Will Always Grow.
Disclosure: None. Follow Insider Monkey on Google News.
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