Super Micro Boosts Earnings, Squeezes Short Sellers

On Monday, Super Micro Computer's stock continued its upward trend following the announcement of a strategy to prevent its delisting from Nasdaq, a move that previously led to a significant rally. Shares of the server manufacturer rose by 16% to $38.30, nearing the highest closing value predictions in nearly four weeks.

The momentum began last Monday when Super Micro Computer appointed BDO USA as its new auditor and announced a plan to request additional time to comply with Nasdaq's listing regulations. This move caused a sharp increase in the stock's value. Over the past five days, the stock has increased by 78%, though it remains 17% below its value from 30 days ago.

Super Micro's listing status was jeopardized after the company missed its deadline to submit its annual 10-K report in August. The company attributed the delay to its "assessment of internal controls over financial reporting." Failure to meet Nasdaq's filing requirements put the company at risk of being delisted.

The company has drawn attention from short sellers, including Hindenburg Research, which accused Super Micro of "accounting manipulation." Currently, there is a high short-interest ratio representing 20% of the stock's outstanding shares, with a days-to-cover ratio of 1.6, indicating a potential short squeeze if positive news emerges.