12:55 PM EDT, 03/20/2026 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our price target sharply to $16 from $40, 5.5x our FY 27 (Jun.) EPS view, well below SMCI's three-year average (~15x) following yesterday's reports that SMCI helped illegally divert up to $2.5B in servers (containing NVIDIA chips) to China. Despite SMCI's liquid cooling leadership, strong backlog, and tailwinds from growing AI spending, we note its already messy history of auditor departures, accounting violations, and de-listings, which make these new violations look more like a structural problem than a one-off mistake, further damaging the company's already weak credibility, especially given the direct involvement of co-founder Wally Liaw. Beyond the tangible financial impacts (we see ~$5B in penalties and the potential restriction of certain APAC sales), we worry about the competitive hit SMCI may take if compliance concerns slow time-to-market (which has been an advantage for the company vs. server peers) or if high-profile partners (i.e., NVIDIA) end their relationship with the company.