Super Micro Stock Surges 13% Pre-Market As Retail Bets On Compliance Filing To Avoid Delisting

Super Micro Computer Inc. ($SMCI) stock jumped as much as 13% before markets opened on Monday as retail investors hope the company will be able to avoid getting delisted from the Nasdaq. 

The company faced a Nov. 16 deadline from Nasdaq ($NDAQ) to address its overdue SEC filings, an issue stemming from accounting irregularities uncovered by Hindenburg Research in a critical short report.

According to a source cited by Barron’s, the server maker intends to submit its compliance plan to Nasdaq by Monday, potentially averting the delisting triggered by its delayed SEC filings. 

Should Nasdaq reject the compliance plan, Super Micro can request a hearing, triggering a 15-day delisting suspension period. 

Super Micro’s stock has also been bolstered by three independent broker-dealers with common ownership — G1 Execution Services, LLC, Susquehanna Investment Group, and Susquehanna Securities, LLC — acquiring a total of 30.8 million Super Micro shares, a stake of 5.3%, according to Barron’s. 

The company’s shares dropped to an 18-month low last week, driven by uncertainty over its regulatory status. 

Stocktwits Poll on SMCI's Stock on Nov 18 as of 8:00 a.m. ET | Source: Stocktwits

Nearly half of retail investors polled on Stocktwits believe that the company will be filing its compliance plan today to avoid delisting, while the rest of the majority believe there’s potential for a short squeeze. 

Retail sentiment around Super Micro on Stocktwits remains ‘bullish’ with retail investors expecting a turnaround for the company’s stock after NVIDIA Corp.’s ($NVDA) third-quarter earnings are announced on Nov. 20.

Super Micro Computer's Sentiment and Message Volume on Nov 18 as of 8:00 a.m. ET | Source: Stocktwits

On Friday, Barclays analyst George Wang suspended coverage of Super Micro due to the resignation of its former auditor and a lack of audited financial statements.

Super Micro Computer was delisted once before in August 2018 for delayed financial report submissions but relisted in January 2020. 

SMCI’s stock has lost 26% of its value this year so far.