A recent report by Hindenburg Research has brought serious allegations against Super Micro Computer, leading to a drop in the company's stock price.
Hindenburg Research Report
On August 27th, Hindenburg Research released a report alleging multiple “accounting red flags,” suspect hiring practices, and circumvention of export restrictions to Russia by Super Micro. As a result, the company's stock fell by 22% over the past 30 days.
Details of the Allegations
The report also highlights previous frictions with regulators, such as temporary delisting from Nasdaq in 2018 and accounting violations in 2020. Hindenburg accuses the company of “improper revenue recognition” and violations of internal accounting controls.
Super Micro's Financial Performance
Despite the scandals, the company’s revenues remain high. For fiscal Q4 2024, net sales were $5.31 billion, and net income increased from $193.5 million to $352.7 million. The average stock price forecast is $674.67, which is 50% higher than the current price of $451.
Although allegations against Super Micro may affect its reputation, the demand for its products and high revenues indicate that it remains a significant player in the IT and data center sector.
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