Super Micro (NASDAQ:SMCI), a prominent AI server maker, saw its stock price plummet on Thursday following reports of a Justice Department investigation into allegations of accounting fraud. The investigation followed a critical report by activist short-selling firm Hindenburg Research that accused the company of accounting manipulation and other issues.
The Wall Street Journal, citing unnamed sources, reported that the Justice Department has launched an investigation into super micro computers. SMCI stock plunged more than 14% to 392.18 on the news, hitting an eight-month low in intraday trading.
The company’s troubles began in August, when Hindenburg Research released a report alleging accounting manipulation, export control failures and customer issues. Supermicro has since delayed filing its annual report with the Securities and Exchange Commission, citing the need for additional time to assess its internal controls over financial reporting.
As a result of this series of events, Supermicro’s stock price fell significantly. Since late August, the stock price has fallen more than 30%. The company’s relative strength rating has also weakened, with its current rating dropping to 27 from a perfect 99 three months ago, according to MarketSurge.
As Supermicro faces increased scrutiny, investors and industry watchers are closely monitoring the situation and looking to see how these developments impact the company’s future in the competitive AI server market. Masu.
This article first appeared on GuruFocus.
