This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.
Super Micro Computer (NASDAQ: SMCI), the struggling retailer of servers and AI racks, has won a rare stock price target upgrade today in what is a testament to the improving sentiment around the battered stock.
Lynx Equity Raises $SMCI PT to $60 from $45, Comments 'Many Investors Are Likely to Return'
Analyst comments: "The Company filed an 8-K Friday after market close - the NASDAQ has granted its request for an extension for filing the necessary 10-K and 10-Q documents. The company…
— Wall St Engine (@wallstengine) December 9, 2024
To wit, Lynx Equity has now hiked its price target for Super Micro Computer shares in a fresh investment note, opting to take a victory lap of sorts for its consistently optimistic tenor on SMCI's prospects.
For the benefit of those who might not be aware, Super Micro Computer now has until the 25th of February 2025, to publish its annual report for its FY 2024 and the requisite financial statements pertaining to its fiscal Q1 2025.
At the outset, Lynx Equity correctly notes that SMCI "will remain listed on the exchange while it prepares the documents under the supervision of its newly appointed external auditor."
The research firm then recalls its earlier rosy outlook on the stock:
"Three weeks ago, in the face of the Street giving high odds for a stock delisting event, we rolled out a $45 PT and opined that odds of delisting were not quite as high as many thought."
As justification for its continued optimism vis-à-vis Super Micro Computer's prospects, Lynx Equity had cited SMCI's "uniquely critical position in the all-important business of installing AI infrastructure." The firm felt that a delisting carried fairly long odds as it would then cut SMCI's access to capital and impair "progress in AI data center build out."
Lynx Equity also believed that Super Micro Computer's competitors would not be able to take advantage of its current vulnerability:
"We also opined that the odds of alternatives such as DELL picking up share from SMCI were not quite as high as many thought. We called for the run-up in DELL on investor expectation of significant gains in AI infrastructure to fade."
Lynx Equity then switches gear to take a victory lap of sorts:
"In the past few weeks, SMCI picked up steam as positive headlines began to hit the tape. With the 8-K filing on Friday, the stock cut above our PT in after-hours action. We are now raising our PT from $45 to $60 based on the expectation that, with the NASDAQ decision in hand, many investors are likely to return."
The research firm believes that many of the analysts and brokerages that had halted Super Micro Computer's coverage will now likely reverse their decision.
Of course, as Lynx Equity rightly notes, "there is no guarantee that the company will be able to file the documents by the appointed date to the satisfaction of the external auditor and the stock exchange."
However, in what constitutes the crux of the research firm's reasoning behind hiking its target for Super Micro Computer shares, Lynx Equity maintains that "until the filing deadline in February, the event-driven volatility is likely to wind down while investors turn their focus to company fundamentals."
"And that is reason enough to raise our PT."
As a refresher, Hindenburg Research had leveled damning allegations against Super Micro Computer back in August, detailing a litany of malpractices at the firm.
Those allegations had then prompted the firm to delay the filing of its annual report for FY 2024 and the quarterly financial statements for Q1 2025. The Nasdaq exchange then concluded that this inordinate delay was inconsistent with its listing requirements.
However, on the 06th of December, Nasdaq accepted SMCI's plan to regain compliance with the exchange's listing requirements, and granted a reprieve until the 25th of February 2025.
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
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