Investing.com — Shares of Super Micro Computer (NASDAQ:SMCI) rose nearly 11% in premarket trading on Monday after a report indicated that the company plans to submit a proposal to delist its stock on the Nasdaq stock market to maintain.
The news comes amid regulatory concerns and significant challenges for the server maker, known for its role in the artificial intelligence boom.
A source familiar with the matter told Barron’s that SMCI plans to present a compliance plan by Monday. The move is crucial for the company to avoid being delisted from the Nasdaq following delayed financial filings and the firing of its accountant.
Super Micro had received a delisting notice in September, requiring the company to file its delinquency reports or submit a plan by November 16.
Super Micro’s troubles mark a stark reversal from its earlier success. At its peak in March, the company’s shares rose 318% this year, fueled by its position as a leader in AI computing.
However, momentum has slowed sharply and shares are down 33% so far this year.
After the Barron report, analysts at Lynx Equity Strategies said this “shouldn’t be a surprise as the CFO had said this during the recent earnings call.”
“We note that at the time of writing, we are not aware of any formal announcement from SMCI regarding plan submission,” the company added.
Still, the company says that given the likely priced-in possibility of delisting, it is not unreasonable to “expect that the shorts that followed the recommendation of the September 27 short seller report will cover their positions.”
“At current levels, we think the stock is trading at a deep discount,” says Lynx, adding that they think it “may be a few headlines away from a quick turnaround.”
The company has a price target of $45 per share for SMCI’s stock.
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