Reports from information technology stock Super Micro Computer (SMCI) sent shares on a catastrophic plunge in Wednesday afternoon’s trading. In fact, the firm announced that it would not be able to file its 10-K report on time “without unreasonable effort or expense,” which sent shares of Super Micro down over 26% in Wednesday afternoon’s trading.
Apparently, the filing noted, Super Micro is currently working on an “assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024.”
Despite this, however, Super Micro isn’t modifying any of the results that have already been announced. With everything remaining in place, it is easy to wonder why Super Micro does not simply release a report based on the information it already has.
A Terrible Time for Accounting Snarls
This news comes at a terrible time for Super Micro. Just yesterday, Hindenburg Research offered up a report of its own that noted it had taken a short position in Super Micro following a slate of concerns about the company itself. One of the biggest, it noted, was “accounting manipulation.” Hindenburg even went so far as to call Super Micro a “serial recidivist,” as such issues continued even after a Securities and Exchange Commission (SEC) settlement.
But not everyone is convinced. Reports noted that Hans Mosesmann of Rosenblatt Securities believes that Super Micro stock could double from here, thanks to technological advancement in liquid cooling, among other things, that could give it impressive new market share figures. And JPMorgan analysts noted that they see “limited evidence of accounting mistreatments beyond revisiting the 2020 charges from the SEC.”
What Is the Future of Super Micro Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SMCI stock based on five Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 52.39% rally in its share price over the past year, the average SMCI price target of $978.50 per share implies 145.76% upside potential.
