Super Micro Slides After Cramer Cites Accounting 'Sell' Signal
CNBC host's bearish call on SMCI amplifies investor concerns following a recent earnings miss and significant insider stock sales.
Shares of Super Micro Computer (SMCI) faced downward pressure after CNBC's Jim Cramer advised investors to sell the stock, pointing to persistent accounting issues as a major red flag. The high-profile bearish call adds to a series of challenges for the server technology company, which has recently navigated a quarterly earnings miss and seen substantial stock sales from its own executives.
During a segment on CNBC, because of its accounting problems, suggesting investors would be better served by buying shares in competitor Dell Technologies instead. This commentary directs a spotlight onto the company's financial reporting integrity, a critical factor for investor confidence, and suggests a potential "flight to quality" within the AI hardware sector.
The negative sentiment from Cramer follows other worrying indicators. The Royal Bank of Canada recently trimmed its position in the company, selling over 94,000 shares. This move is part of a broader trend that has seen significant insider activity. Over the last quarter, , including a notable $12 million sale by CEO Charles Liang in late July.
Super Micro's recent financial performance has also given investors pause. The company's last quarterly earnings report came in at $0.41 per share, missing consensus estimates by $0.03. While revenue grew 8.5% year-over-year to $5.76 billion, it still fell short of analyst expectations. Wall Street remains divided on the stock's prospects, with a consensus "Hold" rating derived from a mix of buy, hold, and sell recommendations. The combination of public criticism, insider selling, and missed earnings targets creates a challenging environment for Super Micro as it seeks to reassure the market.