Super Micro Joins Nvidia, Tesla in Top 3 Options Volume as Stock Tumbles
(This earlier version was erroneously sent only to the Canadian version, so it had to be republished here. Apologies for that.)
$Super Micro Computer (SMCI.US)$ attracted heavier options volume as the stock price slumped to the lowest since May 2023 after the developer of server solutions said it's unable to file its financial report for the quarter ended Sept. 30. That compounded concerns that the company could be delisted.
The company still hasn't hired a new auditor. Ernst & Young resigned in October, noting that it's "unwilling to be associated with the financial statements prepared by management.” In an earlier filing with the Securities and Exchange Commission, SMCI quoted EY as citing information that "raised questions, including about whether the company demonstrates a commitment to integrity and ethical values."
The latest delay adds to investor worries that came after the company missed an earlier deadline to file its annual report for the year ended June 30. In September, Nasdaq notified the company of its non-compliance to the exchange's listing rule that requires the timely filing. Under that rule, SMCI has 60 days to file its form 10-K, a comprehensive annual report submitted to the SEC.
More than 609,700 put and call options changed hands as of 11:54 a.m. in New York Thursday across 17 expiration dates that stretch through Jan. 15, 2027. About 58% of that total is in put options amid rising demand for protection against further slump for a stock that has already seen an 84% slump from a record high in March.
That total volume made SMCI the third most active stock option, behind $NVIDIA (NVDA.US)$ and $Tesla (TSLA.US)$, exchange data tracked by moomoo showed.
That total volume made SMCI the third most active stock option, behind $NVIDIA (NVDA.US)$ and $Tesla (TSLA.US)$, exchange data tracked by moomoo showed.
Put options that give the holders the right to sell the stock at $17 attracted the heaviest volume, with 22,290 contracts changing hands as of 11:39 a.m. in New York Thursday, almost double the open interest. The price jumped 200% for that contract that protects the holder from further stock price slump. The stock last traded at $18.43, down 9.4%.
That's a steep descent from a record high of $122.90 reached in March, the same month the stock joined the S&P 500 index. The rally came amid market frenzy of stocks that are viewed by investors to be the beneficiaries of increasing demand for artificial intelligence. By Aug. 28, when the company announced the delay in filing its annual report, the stock price has tumbled 61% from that all-time peak.
Ernst & Young wasn't the first to raise issues over SMCI's financial statements. In April, former SMCI employee Bob Luong filed a whistleblower lawsuit accusing the company of accounting violations, according to a Wall Street Journal report. Hindenburg Research announced it placed bets against the company's stock in late August, citing in part the allegations made by Luong, according to the report.
The company will likely ask for an extension beyond Nov. 16 of its annual and quarterly filings with Nasdaq, Woo Jin HO, a senior analyst at Bloomberg Intelligence, wrote in a note Wednesday. "Though we expect the company a plan by the deadline, what's unclear is whether it will be enough to satisfy the Nasdaq enough to avoid the delisting process."
Share your thoughts on SMCI or any other stock that you're watching in the comments section. Do you see SMCI heading back to its previous record high? This column was erroneously sent only to the Canadian channel, so it had to be republished here. If you have a price forecast for SMCI, please vote in this version.
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Moomoo Senior News and Community Manager
Former editor at Bloomberg, ex-commentary editor at Lazard. Posts aren’t investment advice. Views are just mine.
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72948725 : It will go down but won't bottom out immediately. Let's see how its solution unfolds.
MANIVARS : Penny stock with malign intentions. Top leadership is responsible for no action
74556213 : That’s a different kind of active
Alen Kok : Oh
Coach Donnie : SMCI wake up