Super Micro Computer (SMCI) saw its stock drop more than 5% on Tuesday, breaking a five-day surge where shares rose nearly 60%. On Monday alone, shares jumped 18%, reaching close to $43, the highest they’ve been since last October. This increase came as investors anticipated a business update scheduled for February 11, hoping for news on compliance efforts with Nasdaq to avoid delisting after a challenging year.
Despite the recent gains, Super Micro’s shares remain significantly below their peak of about $123 from last March, following the company’s inclusion in the S&P 500. This peak came after a strong performance in 2022 and 2023. However, the stock started to decline as Super Micro struggled to meet high expectations from analysts and faced scrutiny from a critical report by Hindenburg Research.
Last August, Hindenburg accused Super Micro of accounting issues, export control violations, and dubious relationships with suppliers. In response, the U.S. Department of Justice reportedly began investigating the company. The departures of key executives and missed earnings expectations added to Super Micro’s troubles. It also faced the threat of delisting from Nasdaq after failing to file its quarterly and annual reports on time.
Hindenburg stopped its short position in mid-January. Super Micro was then given an extension by Nasdaq to submit its missing filings by February 25. The company has since hired a new accountant and stated that an independent review found no evidence of wrongdoing.
Today, Super Micro will report its fiscal second quarter earnings for the December period. Among 11 analysts tracked by Yahoo Finance, six have given the stock a “Hold” rating. They predict that shares could reach around $40.79 over the next year, which is slightly above the opening price of $40.37 earlier today.
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