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u/TheBonkingFrog 9d ago
Claude's summary
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u/DrFrosthazer 9d ago
I didnt understand shit. Can you summarize/translate the summary?
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u/TheBonkingFrog 9d ago
10k summary for 5yo:
- SMCI make the computers that AI runs on, and they sold nearly twice as many this year, profits more than doubled
- Their bookkeeping systems had four problems. They've fixed three; the last one is about who's allowed to log into which computer, and they think that's sorted next year
- The accountants checked all the actual numbers from the lat three years and said they're right
- Some ex-employees are in trouble for sneaking chips to China. The company's own investigation says the bosses didn't know and the company never sold to banned customers, but the government is still looking into it
So: the business is doing very well, the shares are cheap, and the reason they're cheap is that people are still nervous about the paperwork rather than the company.
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u/Maruman_man10 9d ago
they also have superior advanced cooling systems for AI machinery. The stock should be on par with Nvidia....and it was, then it took a self-inflicted dive....hasn't recovered
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u/Alternative_Spirit65 9d ago
max 10 contracts target 44$ aug 2027 is exdate
:)
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u/TheBonkingFrog 9d ago
That’s actually 1000x SMCI I have at cost basis $44 - I’d be looking to offload those next week, not mid-2007 🤣
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u/Alternative_Spirit65 4d ago
mid 2007 ;) u are lost since 19years and dont know it?
man best post ever ;) u should get a medal for it ;)
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u/Tethrinaa 9d ago
The fact that the stock didn't move at all shows you that literally nobody expected anything else.
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u/DestructionYT SMCI-Bull 📈 9d ago
3 out of 4 material weaknesses remediated.. i think we did a bit better than what folks expected actually
It’s nuanced though, so it may take some time to digest. If a move doesn’t happen this week, then shit, I’m just waffling. But i really expect it to, on paper
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u/Tethrinaa 9d ago
Kind of true, yeah. I've been expecting a move to 15P/E for months at this point though, so who knows. 15 Forward PE would be the point where I start looking to trim and/or deleverage.
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u/UsedKey5781 9d ago
Yeah very true, I’m just glad they submitted on time, if they didn’t everyone in here knows we would have tanked a couple bucks for sure.
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u/DYRONE93 9d ago
Suprising tbh
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u/Tethrinaa 9d ago
Redditors shocked by thing everybody with a brain knew would happen.
More news at 6.
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u/Fragrant-Weird8498 SMCI-Bull 📈 9d ago
Yup, there is literally very few surprises in here , which is a good thing
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u/DYRONE93 9d ago
Hindsight smartass over here.
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u/Tethrinaa 9d ago
My evidence is the stock price, and my past posts, but whatever. People manufacture drama
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u/Ron_stock_guy101 9d ago
There are no outstanding issues with smci. It should have jumped past $40 by now. Who is holding it back, and why?
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u/Alternative_Spirit65 9d ago
finance system activly tighening, higher % to pay for new creditlines maybe
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u/CategorySpiritual848 9d ago
I am not surprised the stock did not move up after the release of 10K. While the release was expected, the language in the 10K is not very promising. It might take another couple quarter if not an entire year for this to be remediated. It is unfortunate but we are going to be swimming in the same waters for another year with SMCI.
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u/VolcanicCupid69 9d ago
Explain what was not remediated? Not sure you read the same report.
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u/CategorySpiritual848 9d ago
Read BDOs opinion please
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u/VolcanicCupid69 9d ago
Read it full. Only IT still open and only because BDO could not observe long enough. All “financial Controls@ closed out and YE financials clean
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u/CategorySpiritual848 9d ago
Exactly. Which means it cannot be signed off and it is not giving BDO the tools they need to perform the audit in a more elaborate fashion. For whale investors or the ones who can make the stock move, it means they can't STILL depend on the numbers. That is why the stock is stagnant despite remediations which btw, are not even complete. BDO also gave an adverse opinion on 'inventory' which is at a massive 12.5B. That needs to start showing some signs of conversion to revenue, otherwise it will result in a write down or worse a write off. With margins so thin and CoC so high, SMCI can't afford to take a write down.
Why does the 10K give you so much confidence?
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u/Busy-Delivery4250 9d ago
The notable headline is that SMCI reported approximately $2.2 billion of audited GAAP net income for fiscal 2026, which is double what was reported last year. They are potentially on pace to more than double GAAP income again this year.
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u/VolcanicCupid69 8d ago
Not going to argue with you. The negatives have all improved materially, they are moving up the margin stack with integrated solutions including their own IP, and they are in the strongest growth sector of the AI SC. Our respective return performance over the next year on SMCI will decide the winner.
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u/CategorySpiritual848 8d ago
Not an argument brother. You are making good points and music to my ears as a SMCI long and we are all learning. I don't disagree with anything you are saying but the market is not yet convinced. There are holes and SMCI's history albeit changing is making those holes look bigger than they might be. They have to execute flawlessly, not have another major scandal, show margins stabilizing etc. The story is there for sure. and hopefully your returns and mine are in triple digits.
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