(Bloomberg) — Shares of nursing home operator PACS Group Inc. fell 28% on Monday after Hindenburg Research released a brief report alleging that the company has – among other things – “systematically defrauded taxpayers.”
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The decline put a halt to volatility in the healthcare company’s shares and left PACS with its worst day since its debut as a publicly traded stock in April. The stock closed at a record high of $42.94 on Friday, more than double its initial public offering price of $21.
PACS, based in Farmington, Utah, did not respond to a Bloomberg News request for comment.
PACS operates approximately 284 nursing facilities in 16 states and serves more than 27,000 patients daily, according to a recent filing. Last week, PACS said it had completed the acquisition of eight nursing homes in Pennsylvania, leasing four of the facilities from CareTrust REIT Inc.
Shares of CareTrust fell 4%, the worst one-day drop since September 2022.
Last month, Hindenburg took aim at Roblox Corp. and said in a report that the company inflated key metrics and claimed it does not have sufficient safety screens to protect children using the platform. Earlier this year, Hindenburg released a report on Super Micro Computer Inc., saying an investigation revealed “glaring accounting red flags.” Super Micro delayed the filing of its annual financial disclosures following the report.
Shares of PACS, valued at about $6.7 billion at market close Friday, were up on two quarterly earnings reports that beat expectations, as well as a boost to revenue and profit expectations for the year.
PACS is expected to announce its third quarter results after the market closes on Thursday.
(Updates with closing prices everywhere.)
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