Super Micro Computer (SMCI) stock is up another 7% the day before the server maker is due to report its latest financial results and provide a highly anticipated business update.
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The stock has now risen for four consecutive trading sessions, its biggest win streak since last August when the company was hit with a critical short seller report. SMCI stock is up nearly 30% this year, a big reversal for the shares that had been steadily declining since the autumn.
The current rally comes amid high investor hopes for the company’s Fiscal second-quarter print, as well as an update on the status of its business operations and accounting issues. Specifically, investors are hoping that Super Micro Computer will provide some insights into how close it is to filing its annual accounts for the last fiscal year, which ended June 30.
Delisting Threat
The Nasdaq has given Super Micro until Feb. 25 to submit the needed annual accounts documents or risk being delisted from the exchange on which its stock trades. The company, whose servers run artificial intelligence (AI) microchips and are in big demand, saw its auditor Ernst & Young resign last October, flagging concerns about flaws in the company’s financial reporting.
An internal investigation found no evidence of fraud, and Super Micro has since hired BDO as its new auditor. However, the company still must file the needed accounting documents with the Nasdaq to remove the threat of delisting that has been pressuring the stock in recent months.
SMCI stock is down 50% over the last 12 months, seeing its share price effectively cut in half.
Is SMCI Stock a Buy?
The stock of Super Micro Computer has a consensus Hold rating among five Wall Street analysts. That rating is based on one Buy, three Hold, and one Sell recommendations issued in the past three months. The average SMCI price target of $29.75 implies 24.07% downside risk from current levels.
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