Super Micro Computer (NASDAQ:SMCI) boosted its yearly gains on Thursday as Bank of America initiated coverage on the artificial intelligence-focused server company and stated that AI is sparking a “significant shift” in the market.

“We believe this provider of server and storage solutions will benefit from AI-driven demand growth (>50% of revenues now tied to accelerators like GPUs),” analysts led by Ruplu Bhattacharya wrote in a note. “We believe the market for AI servers is much larger than is factored into Street models.” The analysts assigned a Buy rating and $1,040 price target on Super Micro.

Shares surged nearly 5% in premarket trading and have soared over 208% year-to-date.

The market for AI servers is expected to grow at a 50% annual clip over the next three years, well above the 5.5% that the traditional server market has grown over the past 17 years, the investment firm reported. As a leader in the space, Super Micro’s revenue is anticipated to grow even faster and capture market share as a result.

Under the leadership of CEO Charles Liang, Super Micro has reaped rewards from successful partnerships with companies such as Nvidia (NVDA), AMD (AMD), and Intel (INTC) for CPUs and GPUs accelerators. It has also leveraged its expertise to construct server technology from the ground up and develop its own chassis, motherboard, and other components, enabling it to offer the highest performing customized solutions for its customers, granting it a “key competitive advantage,” the analysts noted.

“We believe its ability to collaborate on multiple new designs and technologies will serve it well as myriad AI-related processors debut in the next several years,” the note added.