Super Micro Computer (SMCI) stock fell hard on Wednesday, down about 6%, as investors remained concerned about the company’s future on the Nasdaq Stock Exchange. The drop occurred despite CEO Charles Liang’s remarks at the Reuters NEXT conference on Tuesday, where he expressed confidence that the company would not face delisting from Nasdaq over financial disclosure issues.
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The stock has been highly volatile in recent days, primarily due to worries about the company’s ability to resolve ongoing financial reporting issues and investigations. The company’s troubles began after Hindenburg Research issued a report accusing SMCI of accounting fraud.
In response to these challenges, SMCI submitted a compliance plan to Nasdaq and received an extension until February 25, 2025, to file its delayed financial reports.
Investors Fear Exclusion of SMCI from Nasdaq 100
Amid uncertainty surrounding its future on the Nasdaq, investors are also anxious about Super Micro Computer’s potential removal from the Nasdaq 100 index (NDX) during the annual reconstitution process on December 13, according to a Barrons report.
It’s important to note that during reconstitution, companies on the Nasdaq are ranked by market value based on their stock prices as of the last trading day in November, which this year was November 29. Given this, SMCI, being among the Nasdaq 100 companies with the lowest market values on that date, faces the risk of being excluded from the index.
Is SMCI Stock a Good Buy?
Owing to several challenges plaguing SMCI, analysts remain sidelined on the stock, with a Hold consensus rating based on two Buys, five Holds, and two Sells. At $38.57, the average Super Micro Computer price target implies a 0.73% upside potential.
