From NASDAQ.: 2024-11-14 18:22:06

Super Micro Computer (NASDAQ: SMCI) stock experienced significant sell-offs, closing down 11% in Thursday’s trading session. The stock has plummeted 62% in the last month and 36.5% year-to-date, hitting an 85% drop from its all-time high in March. The company is facing challenges with missed filing deadlines and potential delisting from the Nasdaq exchange.

Supermicro stock fell further after Cisco’s AI server market plans were revealed, resulting in a 6.3% decline. The company’s valuation pullback was exacerbated by a delayed filing with the SEC and uncertainties surrounding its financial reporting. Trading at low valuation multiples, Supermicro stock appears undervalued, but risks and controversies persist, making it a risky investment.

Supermicro’s troubles intensified with Ernst & Young resigning as the financial auditor, citing concerns over management’s representations. The company has not filed its 10-K report and is at risk of missing the deadline for its 10-Q report. Reports of weakening competitive position and diverted GPU shipments from Nvidia add to the uncertainties surrounding the stock.

Amidst the ongoing controversies and uncertainties, investing in Super Micro Computer is deemed risky. The company’s potential delisting, financial reporting issues, and competitive challenges make it a less attractive investment option. Investors seeking AI plays with less risk should consider alternative opportunities for potential returns.



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