Super Micro Computer stock suffered a 33.3% bear gap on March 20
AI computer hardware name Super Micro Computer Inc (NASDAQ:SMCI) is set to snap its three-day win streak, as legal woes weigh on sentiment. An investor-filed a class action lawsuit against the tech name accused it it of committing securities fraud by concealing its dependence on China sales. This resulted in last week's criminal chip smuggling charges, which triggered a 33.3% loss on March 20.
Last week's bear gap had the shares shuttering below support at the $30 level, contributing to their grim 37.1% year-over-year deficit. While analysts have yet to chime in today, earlier this week the stock saw several price-target cuts, including from BofA Global Research to $24 from $34.
Analysts lean heavily bearish toward the security, with 14 of the 19 in coverage sporting a "hold" or worse rating. However, more price-target cuts could be in order, with the equity's average 12-month consensus price target of $34.76 at a nearly 50% premium to current levels.
Shorts have been building their positions on SMCI, with short interest up 4% in the most recent reporting period. This accounts for 17.1% of the stock's available float, meaning it would take short sellers over two days to buy back their bearish bets.