Supermicro committee report ‘assuaging broad concerns,’ says JPMorgan

After Super Micro announced the completion of the review by its Independent Special Committee, which expressed the opinion that there is no evidence of misconduct or fraud on the part of management or the board, JPMorgan noted that the committee did make recommendations despite its findings, including to appoint a new CFO to succeed David Weigand, as well as to install a Chief Accounting and Compliance Officer as well as a General Counsel, all of which the board has agreed to do. While the detailed report is “assuaging broad concerns,” the firm remains sidelined and keeps an Underweight rating on the shares until visibility into compliance increases. The next key watch points for investors to monitor include whether the new independent auditors, BDO, accept the findings of the committee or decide to undertake their own independent review and whether Nasdaq supports Super Micro’s request for an extension of time to regain compliance with the Nasdaq continued listing requirements, the analyst tells investors.