3 Significant Risks That Market Has Yet To Price In For Super Micro Computer
- Following an eye-watering rally earlier this year, the SMCI stock has now flipped to YTD declines as it faces continued implications of ongoing accounting woes.
- In the latest turn of events, SMCI's auditor, Ernst & Young, has resigned from the engagement. This casts further uncertainties on when investors can expect SMCI's delayed 10-K filing.
- In the meantime, SMCI bulls continue to believe that the company's accounting problems and delayed 10-K filing are isolated issues from its technological advantage in capturing AI opportunities.
- However, SMCI's delayed 10-K filing alone (even if without material misstatements) has adverse cascading effects on its operations, which are fast approaching yet remain underappreciated by the market at current levels.
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The Super Micro Computer stock (NASDAQ:SMCI) has traded down by more than 40% after Ernst & Young (EY) resigned from the audit engagement on October 30. The stock has lost more than 40% of its value over the past
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