Super Micro Computer (SMCI) is the worst S&P 500 stock Thursday, extending Wednesday's decline, after the AI server, software and infrastructure firm announced it would delay the filing of its quarterly earnings.
In a filing with the Securities and Exchange Commission (SEC) issued November 12, SMCI said it is unable to file its financial results for its most recent quarter ended September 30 "without unreasonable effort or expense."
The company had previously notified the SEC that it was unable to file its annual report for its year ended June 30, adding to the problems facing SMCI.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Super Micro said it is "diligently working to select an independent registered public accounting firm" following the resignation of its previous accounting firm, Ernst & Young, on October 24.
In its resignation letter, Ernst & Young said it was "unwilling to be associated with the financial statements prepared by management," according to CNBC.
Will Super Micro get delisted?
The SEC requires publicly traded companies to file annual reports to maintain their listings on U.S. stock exchanges, which SMCI has yet to do for its year ended June 30, 2024.
SMCI has until November 16 to file or submit a plan to the Nasdaq Stock Exchange to regain compliance with its listing rules, according to Barron's. With that deadline just two days away and the company having yet to name an accounting firm, there is rising concern that SMCI will not regain compliance.
So, what will happen to the stock? "You still hold shares, the shares are still traded. They’re traded on the pink sheets [over-the-counter markets]," Wedbush analyst Matthew Bryson told Barron’s.
Here's what Wall Street's saying about Super Micro Computer
Given Super Micro Computer's struggles on and off the price charts – shares are down 77% in the past six months – Wall Street is on the sidelines when it comes to the tech stock.
Of the 12 analysts following the AI stock tracked by S&P Global Market Intelligence, one says it's a Strong Buy, two have it at Buy, seven call it a Hold, and two rate it Sell or Strong Sell. This works out to a consensus recommendation of Hold.
And amid SMCI's troubles, some analysts have washed their hands completely of the stock.
"Given the reputational and financial restatement risks raised by Ernst & Young's resignation as the company's certified public accountant, we have suspended our rating on shares of Super Micro," said Needham analyst Quinn Bolton in a November 6 note.
Related Content
-
Before You Invest Like a Politician, Consider This DilemmaAs apps that track congressional stock trading become more popular, investors need to take into consideration some caveats.
-
How to Put Together Your Personal Net Worth StatementNow that tax season is over for most of us, it's the perfect time to organize your assets and liabilities to assess your financial wellness.
-
Stock Market Today: Trump Retreats, Markets RejoiceStocks rally, yields soften, the dollar rises, and even beaten-down names enjoy the wages of potential trade peace.
-
Tesla Stock Pops as Elon Musk Promises DOGE Draw BackTesla reported a sharp drop in first-quarter earnings and sales, as the EV maker suffered a backlash to its CEO's political ambitions.
-
Bouncing Back: New Tunes for Millennials Trying to Make ItAdele's mournful melodies kick off this generation's financial playlist, but with the right plan, Millennials can finish strong.
-
Early-Stage Startup Deals: How Do Convertible Notes Work?Some angel investors support early startups by providing a loan in exchange for a convertible note, which includes annual interest and a maturity date.
-
Stock Market Today: Stocks Soar on China Trade Talk HopesTreasury Secretary Bessent said current U.S.-China trade relations are unsustainable and signaled hopes for negotiations.
-
How Can Investors Profit From AI's Energy Use?Global energy demand is expected to grow by leaps and bounds over the next several years as AI usage accelerates. Here's how to get a piece of the pie.
