(Bloomberg) — Shares of nursing home operator PACS Group Inc. fell. by 28% on Monday after Hindenburg Research released a short report alleging that the company was – among other things – “systematically defrauding taxpayers.”
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The decline halted volatility in the health care company’s stock, and PACS had 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 Bloomberg News’ request for comment.
PACS operates about 284 nursing facilities in 16 states and serves more than 27,000 patients daily, according to a recent filing. Last week, PACS said it completed the acquisition of eight nursing homes in Pennsylvania, with four of the facilities being leased from CareTrust REIT Inc.
CareTrust shares fell 4%, the worst one-day decline since September 2022.
Last month, Hindenburg took aim at Roblox Corp, saying in a report that the company had inflated key metrics and claimed it did not have enough safety screens to protect children using the platform. Earlier this year, Hindenburg issued a report on Super Micro Computer Inc., saying the investigation revealed “glaring red flags in accounting.” Super Micro was late in filing its annual financial returns following the report.
Shares of PACS, valued at about $6.7 billion at market close on Friday, rose on the back of two quarterly earnings reports that beat estimates as well as a boost to its revenue and earnings guidance for the year.
PACS is scheduled to announce third-quarter results on Thursday after the market closes.
(Updates with closing prices all the time.)
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