Super Micro Computer (SMCI) Stock Plummets After Five-Day Rally
Super Micro Computer (SMCI) experienced a significant drop of 4.29% in early trading on Tuesday, halting a five-day rally that resulted in a 60% gain.
Rally Preceded by Business Update and Nasdaq Delisting Concerns
The stock surge occurred ahead of a scheduled business update on February 11th. Investors anticipate insights into the company's efforts to comply with Nasdaq regulations and avoid delisting.
All-Time High and Subsequent Decline
Despite the recent upswing, SMCI remains below its all-time high of $123 set in March 2022. Following a strong performance in 2022 and 2023, the stock faced challenges due to missed expectations and allegations raised by Hindenburg Research.
Hindenburg's Allegations and Department of Justice Probe
In August 2022, Hindenburg alleged accounting violations, export control breaches, and questionable relationships in SMCI. The company's accountant resigned, and the US Department of Justice reportedly initiated an investigation into its accounting practices.
Nasdaq Extension and Earnings Report
Last year, Nasdaq granted SMCI an extension to submit late SEC filings by February 25th. The company reports its fiscal second quarter earnings for the December period after the bell on Tuesday.
Analyst Ratings and Price Targets
Six of the 11 analysts covering SMCI recommend a Hold rating. The consensus price target for the next 12 months is $40.79, slightly higher than its pre-market open price of $40.37.