Super Micro Computer Stock Slumps on Nasdaq 100 Removal, Possible Capital Raise

Key Takeaways

Super Micro Computer (

SMCI

) shares slumped Monday morning as the stock feels the impact of a pair of headlines that came out after the bell Friday, including a potential capital raise and the
stock’s removal from
the
Nasdaq 100 Index
.

The Nasdaq said Friday that Palantir (

PLTR

), MicroStrategy (

MSTR

), and Axon Enterprise (

AXON

) would join the index starting next week, replacing Super Micro Computer, Moderna (

MRNA

), and Illumina (

ILMN

).

Super Micro is being replaced on the index
less than six months
after it was added in July, as shares have lost 70% of their value entering Monday since closing at a record $118.81 in March.

Along with the index removal,

Bloomberg

also reported Friday that Super Micro has hired investment banking advisory firm Evercore (

EVR

) to assist the server maker in raising capital. The raise could involve equity or debt, or take the form of an investment from a private equity company,

Bloomberg

reported.

The hardware manufacturer has raised capital once this year, as
it said in March
that it would sell 2 million new shares as it looked to raise $2 billion.

Super Micro shares have fallen in the second half of the year as the company has seen earnings reports
miss estimates
, and has also
been the subject
of a
short-seller’s
report alleging
accounting manipulation and
other issues
, along with the
resignation of its last auditor
. Super Micro also
delayed the filing
of its annual report for its last fiscal year, and last week
received an extension
for the filing to ensure the stock wouldn’t be delisted from the Nasdaq.

Shares of the tech company were down more than 11% in premarket trading Monday.

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