Is SMCI ready for a stock split

Investors familiar with ultra-microcomputers know that the company's business strategy is to provide high-performance, energy-efficient server solutions to a wide range of industries. The company's products target industries with high computing demand in fields such as cloud computing, artificial intelligence, and big data analysis.

Ultra microcomputers are known for responding flexibly to new developments in the server component market. Since the company has connections with major companies in the industry, it is possible to obtain products adopting the latest CPUs and other advanced technologies ahead of competitors. Furthermore, the company's server solutions are highly customizable, and customers can customize the system according to specific needs.

In order to stay ahead of the curve, supermicrocomputers have invested heavily in research and development. In fact, funds spent on research and development accelerated in conjunction with revenue growth and reached 53.9% (18.8 million dollars in 1 year until 2023/12, 70.7 million dollars in the same period last year).

Since stock splits affect shareholders, voting rights must be exercised. A special vote can be held whenever an enterprise determines that it is necessary, but it is common for an annual general meeting to vote on other items such as the election of the board of directors, the salary system, and which accounting firm will perform the audit.

Just because Supermicro's stock price exceeds $1,000 does not necessarily mean that a stock split will take place. However, this is a historic level where many companies have chosen to split, and investors will soon be informed whether a split is inevitable.

The price-earnings ratio (PER) is 80.51 times, which greatly exceeds the industry median value of 23.12 times and the 5-year average of 15.77 times. The news that ultra microcomputers will be adopted in the S&P 500 has been announced for a long time, and many investors and organizations feel that the positive material has been sufficiently digested.