Investors must contend with a painful but critical risk of investing.The resignation of Ernst & Young (EY) as Super Micro Computer's (SMCI -31.94%) accounting firm sent its stock reeling. Not only did its stock plunge but now investors must also contend with one of the more promising tech growth stories getting derailed by alleged accounting irregularities.Considering this challenge, Supermicro has instead become a painful investing lesson. Unfortunately for investors, there's only one way to mitigate the p ...

With the share price of Super Micro Computer (NASDAQ: SMCI) crumbling amid investor concerns over its accounting practices, an unidentified trader has seen substantial gains on the company’s put contracts.In a trade considered “unusual,” the trader purchased 3,000 put contracts on SMCI at a $29 strike price, achieving a 3,000% gain in just one week, data shared by The Kobeissi Letter on October 30 indicates.The trade details reveal that the put contracts were acquired at a bargain price of $0.05 each a week ...

Core Insights - Super Micro Computer Inc. (SMCI) has experienced a significant decline in stock price following allegations of accounting fraud and other serious issues raised by Hindenburg Research [2][3] - The company's stock reached an all-time high of $118 in March, reflecting a year-to-date increase of 332% and a two-year return of 2,500% before the recent downturn [2] - Following the resignation of the company's auditor, Ernst & Young, SMCI's stock plummeted by 29.38% in a short period, indicating a loss of investor confidence [2][3] Stock Performance - SMCI's stock price fell from $54 to $38 after the initial allegations, marking a nearly 30% drop [2] - As of the latest update, SMCI shares are trading at $33.52, still reflecting a year-to-date increase of 72.08% despite the recent turmoil [2][3] Trading Activity - An anonymous options trader made a significant profit of 3,000% by purchasing 3,000 put contracts at a strike price of $29 when SMCI was trading at $45.36, raising suspicions of insider trading [4][5] - The put contracts were initially bought for $0.05 each and are now valued at $1.55, resulting in a profit of $4,500 from a $150 investment [5][6] Future Outlook - There are indications that SMCI's stock price may continue to decline, potentially increasing the profitability of the aforementioned options trade [6]

Gone are the days of Super Micro Computer (NASDAQ: SMCI) breaking records and mesmetizing investors with its incredible stook market advance, and the most recent developments indicate they aren't coming back in the foreseeable future. Specifically, on October 30, the fact that Supermicro's auditor, Ernst & Young, resigned six days earlier became public knowledge. The filing proved particularly shocking due to the reasons given by the firm as it stated it is: Resigning due to information that has recently co ...

Key Takeaways Super Micro Computer shares plunged Wednesday after accounting giant EY resigned as the company's auditor. The accounting firm said it is "unwilling to be associated with the financial statements prepared by management." The resignation comes after months of speculation about Super Micro Computer's accounting practices following a report from short seller Hindenburg research accusing it of "manipulation." Super Micro Computer (SMCI) shares plunged Wednesday after accounting firm EY resigned as ...

Charles Liang, chief executive officer of Super Micro Computer Inc., during the Computex conference in Taipei, Taiwan, on Wednesday, June 5, 2024. Super Micro's shares plunged as much as 35% Wednesday morning after the company disclosed its auditor had resigned following months of disagreement with the firm over its governance and board independence. Ernst & Young in its resignation letter said it was "unwilling to be associated with the financial statements prepared by management." The accountancy also rai ...

Could there be more growth ahead for this potentially troubled AI player?Artificial intelligence (AI) just might be the biggest investing theme of the year. Technology companies operating in this area drove gains in the S&P 500 in the first half, and many of these players continue to advance. Why are investors so interested in AI? Because of the technology's potential to revolutionize everything from your daily routine to how a company operates. As a result, companies making or using AI could see their earn ...

In Q1 2024, Super Micro Computer (NASDAQ: SMCI ) (NEOE: SMCI:CA ) was certainly one of the red-hot stocks, driven by the AI-investment narrative, which pushed the stock to its all-time high of $1,230/share by the end of March, compared to $300/share at the beginning With 30 years until retirement, I'm leveraging my role as a Financial Analyst at a Fortune 500 firm to build a market-beating portfolio that targets both strong capital appreciation and aggressive dividend growth.My focus is on blue-chip compani ...

Core Insights - The company is facing increasing pressure to provide updated financial statements to investors [1] - Concerns regarding the company's financial statements are overshadowing its strong sales and profit growth [1] Financial Performance - Super Micro Computer (SMCI) has demonstrated excellent growth in sales and profit [1] - Despite the positive growth metrics, the stock is under pressure due to financial statement concerns [1]

Core View - Super Micro Computer Inc (SMCI) has experienced significant growth due to advancements in cooling technology and its inclusion in major indices, but faces challenges including a 61% stock decline from March highs due to financial scrutiny and delayed filings [1][2] Key Drivers - The global AI market is projected to grow from $148 8 billion in 2023 to $1 1 trillion by 2029, with a CAGR of 39 7% from 2024-2029, driving demand for SMCI's AI GPU server solutions which account for 70% of its revenue [4] - SMCI's direct liquid cooling (DLC) technology reduces power consumption by up to 40%, with over 100,000 NVIDIA GPUs deployed using this solution, enhancing its competitive position in AI and high-performance computing [4] Financial Metrics - SMCI trades at a P/E ratio of 23 53 and a forward P/E of 14 03, with a PEG ratio of 0 26, indicating robust growth potential relative to earnings and suggesting the stock is undervalued compared to tech peers [5][8] - A recent 10-for-1 stock split has made SMCI shares more accessible to a broader range of investors, potentially increasing trading volume and investor interest [3][8] Market Sentiment and Predictions - Analysts are optimistic about SMCI, with Needham's Quinn Bolton predicting a 32 3% upside from current levels, citing the company's strong position in the growing demand for liquid cooling infrastructure [6] - AI models project SMCI stock could trade between $60-$65 by end of 2024, with a potential 12-month target of $80-$85, assuming sustained industry growth and successful technology integration [7][8]