Here’s Why Super Micro Computer Stock Fell Again Monday

Management at Super Micro Computer (NASDAQ: SMCI) gave investors a much-anticipated business update last week that did not appease investor concerns. And the company faces yet another major hurdle this week.

Concerns about an upcoming deadline as well as fears of lost business opportunities have the stock sliding today. As of 10:40 a.m. ET, Supermicro shares were starting off the week down by 11.1%. That brings the monthly drop in the stock to about 53%.

Start Your Mornings Smarter! Wake up with Breakfast news in your inbox every market day. Sign Up For Free »

Supermicro provides server stacks and cooling systems for data center computers. Its business had been ramping up quickly with surging revenue as demand for artificial intelligence (AI) computing accelerated data center growth. But after a short-seller report and the company delaying the release of its 10-K annual report, investors had to question the legitimacy of the company’s prior financial results.

Last week Supermicro provided an update saying sales would be slightly lower than prior guidance. It also said an investigation by a special committee found “there is no evidence of fraud or misconduct on the part of management or the Board of Directors.”

While that sidesteps a worst-case scenario, the company has yet to file its annual report for its fiscal year ended June 30. It now faces a Nov. 16 deadline to offer a plan to the Nasdaq Stock Exchange to regain compliance according to stock listing rules. A delisting from the major exchange would very likely lead to more selling of Supermicro stock.

Investors are getting ahead of that potential drop by selling shares today, it seems. The move shouldn’t be looked at as a buying opportunity either. Reports have also said the company is losing business due to the instability of the situation. Supermicro is best watched from the sidelines unless or until the company shows in its annual report that its business is stable and its financial data is accurate.

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

  • Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $23,446!*

  • Apple: if you invested $1,000 when we doubled down in 2008, you’d have $42,982!*

  • Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $428,758!*


Source link

About admin

Check Also

Super Micro Stock Has Made a ‘Round Trip’ From Last Year. Where It Is Headed Next, According to History.

Super Micro Stock Has Made a ‘Round Trip’ From Last Year. Where It Is Headed …

Leave a Reply

Your email address will not be published. Required fields are marked *