Key takeaways
- Shares of Super Micro Computer fell nearly 28% on Wednesday after announcing a capital raise targeting up to $7 billion.
- The financing includes the issuance of 45.45 million shares at a price of 27.50 US dollars and 75 million depositary shares at a price of 50 US dollars per share.
- Capital will support component purchases for approximately $39 billion worth of AI server contracts from more than 20 customers
- Wolfe Research launched coverage with a Peer Performance rating, highlighting the legal uncertainty associated with co-founder Wally Liaw’s indictment.
- Shares rebounded 1.37% in Thursday’s pre-market session to $29.67. Analysts maintain a Hold consensus with an average price target of $32.70
Shares of Super Micro Computer fell nearly 28% during Wednesday’s trading session after the company unveiled a financing initiative that could generate up to $7 billion in capital. The stock managed a modest 1.37% rebound in pre-market trading on Thursday, reaching $29.67, although steep losses the day before continued to weigh on sentiment.
Super Micro Computer Company, SMCI
The capital raising consists of two simultaneous offers. Super Micro plans to issue 45.45 million common shares at $27.50 per share along with 75 million depositary shares at $50 per share, with the latter tied to 7.0% mandatory convertible preferred stock.
The company expects to raise approximately $1.22 billion from the common stock stake and approximately $3.68 billion from the preferred stock transaction. Combined with an active $1.25 billion market equity program, total available capital is approaching $7 billion.
Super micro It noted that the proceeds will primarily fund acquisitions of components needed to complete approximately $39 billion in AI server commitments from more than 20 different customers. The additional funds will address debt obligations, working capital requirements and capital spending needs.
This revelation alarmed market participants who were already dealing with heightened uncertainty. The Defiance Daily Target 2X Short SMCI ETF jumped nearly 40% on Wednesday as short sellers benefited from the sharp downturn.
Wolfe Research launches coverage with a neutral stance
Wolfe Research provided coverage of SMCI on Thursday with Peer Performance, focusing on the legal and compliance uncertainties stemming from the indictment of co-founder Wally Liaw. The research firm estimates fair value between $26 and $31 per share, which represents 9 to 11 times expected 2028 earnings.
Wolf’s financial model projects 2028 revenues of $68.2 billion with earnings per share of $2.90. The analyst identified several headwinds including the possibility of BDO USA’s auditor stepping down or additional management turnover. No other company leaders have been implicated in these accusations, and Super Micro maintains its partnership with… Nvidia Stays strong.
While customer demand appears strong – as evidenced by a record-high order backlog – Wolf expressed an unwillingness to adopt a more optimistic valuation stance given the high-risk environment.
According to InvestingPro’s valuation framework, the fair value is $40.03, indicating potential impairment at current levels. The stock is down 37.6% over the past week alone.
Chart analysis indicates continued weakness
SMCI is currently trading below all major moving averages. The stock is sitting 23.4% below its 20-day moving average, 7.6% below its 50-day moving average, 5% below its 100-day moving average, and 18% below its 200-day moving average. The year-on-year performance shows a decline of 32.3%.
The bearish death crossover pattern appeared in December 2025 and is still active. The MACD is trading below its signal line with a negative chart reading – a configuration that typically does not encourage bullish positioning.
Chart watchers are watching for resistance in the $30 area and support near $29.50.
Mizuho maintains a neutral stance and raised its price target to $44 on June 1. The Street consensus remains steady with an average price target of $32.70.
