Mizuho Maintains Neutral Rating on Super Micro Shares, Citing Delisting Risk

Super Micro Computer (SMCI) stock has been under pressure in recent months due to concerns about its potential delisting from the Nasdaq.

Mizuho analyst Vijay Rakesh maintained a Neutral rating on Super Micro shares and lowered the price target to $20 from $23. Rakesh cited the ongoing delisting risk as the primary reason for the downgrade.

The Nasdaq has given Super Micro until October 3, 2023, to regain compliance with the minimum bid price requirement. If the company fails to do so, its shares could be delisted from the exchange.

Super Micro has been trying to address the delisting risk by implementing a reverse stock split.

In a reverse stock split, a company reduces the number of outstanding shares while increasing the share price. This can help a company meet the minimum bid price requirement.

However, Super Micro's reverse stock split has not been successful in boosting the share price. The stock is still trading below the $1 minimum bid price requirement.

Mizuho's Rakesh believes that the delisting risk is a significant overhang on Super Micro shares.

He said that the company's fundamentals are solid, but the delisting risk is preventing investors from buying the stock.

Rakesh said that he would be more positive on Super Micro shares if the company can regain compliance with Nasdaq's listing requirements.