Supermicro committee findings positive ‘on a variety of fronts,’ says Wedbush

Wedbush views the findings from Supermicro’s (SMCI) special committee as a net positive for the company. The firm presumes Supermicro’s new auditor, BDO, was appraised of the findings as well as the suggested solution and is ok with the suggested course of action. Assuming this is the case, with no changes to financials, there should not be any impediment to Supermicro eventually filing its delayed financials within the course of a typical extension provided by the Nasdaq, the analyst tells investors in a research note. As such, Wedbush believes the risk of a delisting “appears to have been minimized. Presumably, any related disruption to the company’s business tied to either customer concerns around EY’s resignation or the possibility of more significant misdeeds should reverse, the firm adds. Wedbush feels yesterday’s news should be construed as positive for Supermicro “on a variety of fronts,” but admits it is also less certain how the recommended solutions create an improved set of controls in an organization where it is generally understood that significant decisions come out of the CEO’s office. The lack of larger apparent changes to Supermicro’s executive structure “arguably leave the company more open to future financial missteps (real or imagined),” the firm writes. It keeps a Neutral rating on the shares with a $24 price target The stock in midday trading is down 2% to $41.07.