Since late August, Super Micro Computer, Inc. (NASDAQ:SMCI) has faced a challenging period. The company, one of America’s largest manufacturers of high-end servers crucial for AI tasks, recently took a hit after the activist short-selling firm Hindenburg Research released a report accusing Supermicro of having “glaring accounting red flags.”
This allegation caused Super Micro Computer, Inc. (NASDAQ:SMCI) to drop 20%, falling to $443 per share. The situation worsened when news emerged of a potential Department of Justice (DOJ) investigation into these alleged accounting issues, pushing the stock down another 12%, dropping it below $400 per share.
However, despite this turbulence, Super Micro Computer, Inc. (NASDAQ:SMCI)’s current stock price of around $42 per share isn’t due to a market crash. Instead, the company implemented a 10-for-1 stock split. This means for every share that existed before the split, investors now own ten.
As a result, the stock price per share has been reduced to one-tenth of its previous value. Before the split, the stock was valued at $416.40 per share, and with the split, each share is now worth approximately $42. It’s important to note that the stock split doesn’t change Supermicro’s overall market value.
As of yesterday, Super Micro Computer, Inc. (NASDAQ:SMCI)’s market capitalization was around $23.7 billion, and today it remains roughly the same. Essentially, the stock split has only increased the number of shares while reducing their individual price proportionally. However, with the DOJ possibly investigating the company, the stock may experience further volatility.
Super Micro Faces Nasdaq Delisting Risk Over Delayed Filings
Super Micro Computer recently received a notification from Nasdaq stating that it is not in compliance with Nasdaq’s listing rules due to the delayed filing of its reports with the U.S. Securities and Exchange Commission.
Specifically, the company failed to submit its Form 10-K by the deadline of August 29, 2024, only filing a Form 12b-25, which provides a brief extension, on August 30, 2024. This compliance issue followed a period of notable events for the company.
On July 22, 2024, Super Micro Computer was added to both the Nasdaq-100 and Nasdaq-100 Equal Weighted Indices, marking a significant achievement. Shortly thereafter, on August 6, the company released its fourth-quarter and full-year financial results for the fiscal year that ended on June 30, 2024.
However, this positive momentum was overshadowed by a new investigation initiated by Hindenburg Research in August. The investigation centers around allegations of “potential accounting manipulation and sanctions evasion.”
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