Super Micro Computer: Is the Upswing Coming After the Crash?

Stock splits have played a significant role in the markets this year. Prominent companies like Nvidia and Walmart have undertaken such measures. These are often welcomed by investors as they reduce the price per share, making them accessible to a broader range of investors. Although a stock split does not change the value of the company or the individual holdings, it often sends a positive signal from the company's management. Currently, Super Micro Computer is at the center of market participants' attention. Following recent turmoil surrounding a report by short-seller Hindenburg Research, which accused the company of "accounting discrepancies," and a possible investigation by the U.S. Department of Justice, the stock has declined in recent weeks. The market is eagerly watching September 30, when the next major stock split is scheduled to occur. The negative report has unsettled investors. However, Supermicro has clarified that it does not expect significant changes in financial results and has described the short report's claims as "false or inaccurate." Although the final results of the investigation are still open, past experiences have shown that such situations do not necessarily indicate misconduct. Super Micro Computer can look back on an impressive development. Bolstered by the boom in Artificial Intelligence (AI), the company has seen significant revenue increases in recent years. The recently opened facility in Malaysia demonstrates the company's ambitions to expand production and reduce costs. Despite recent setbacks, the company's shares have risen by an astonishing 2,200% over the past five years. But how will the stock perform after the split? While short-term forecasts are challenging, historical data shows that stock splits typically lead to outperformance relative to the S&P 500 over a twelve-month period. This could also apply to Supermicro, provided no further negative news affects the company. For current investors, panic selling is not recommended. The long-term prospects of the company in a growing market remain promising. New investors, on the other hand, should wait for further clarity from the company and potential regulatory developments before making a decision.