The risk and reward of SMCI

$Super Micro Computer (SMCI.US)$ has tumbled from its all time high due to delayed filing of its financial report. This has created concerns for a potential delsiting from Nasdaq 500. The extension given by Nasdaq for a delayed filing has alleviated immediate delisting concerns, which was the key driving force behind the recent surge in stock prices. However, last week, it was announced that SMCI has been dropped from Nasdaq 100, resulting in a double digit decline in the stock price pre-market. What does this mean for investors?

A potential buying oppprtunity?: The current price is much lower than the ATH and should it sucessfully submit its financial reports by Feb, the stock will likely not be delisted. Given the financial performance of the company in the past and the AI trend, the low price now could be an entry point for buyers. We can possible target cheap entry points for a longer term hold till Feb and beyond.

The risk that needs to be addressed: While there is undeniable upside for the stock, investors should still mindful of the existing risk. Please consider them and do your own research before investing.

1. Has the governance issues that resulted in the late filing been resolved?

2. Will the financial report in Feb paint a similar rosy picture?

3. How will delisting from Nasdaq 100 impact share prices and how will that impact listing/delisting from Nasdaq 500?

4. Will investor confidence be impacted by the whole fiasco?

5. What is the current likelihood for Nasdaq 500 deslisting?

Please do your own research and invest within your own means. May we all prosper fellow investors.

Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only. Read more

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