Once trading as a high-flying artificial intelligence server supplier, Super Micro (SMCI) stock fell on hard times. The stock bottomed at below $400 in recent weeks after the company reassured investors on September 3.
SMCI’s CEO Charles Liang wrote a letter to its customers that day. He said that neither its delay in filing its annual report nor Hindenberg Research’s disclosure would have any business disruption. Although the letter will reassure its customers that it will meet delivery expectations, investors are less confident.
Last Friday, Nasdaq sent SMCI a notification letter. It stated that the firm is not in compliance with Nasdaq listing rule 5250(c)(1). Speculators need not bet on the firm rebounding anytime soon. The company does not run at operating margins that are comparable with its competitors. Investors may buy Hewlett-Packard Enterprise (HPE) or Dell (DELL) instead.
Investors who sold SMCI stock at over $1000 and bought Dell shares may sleep well at night.
Avoid this company until the company finds an auditor who will sign off on its 10-K filing. Readers considering this stock should watch on the sidelines. Should it regain compliance, the stock would jump. However, it is worth letting the stock rise first with the unknowns out of the way. Until then, SMCI stock is a risky speculation.
