Holy $#it?! Stock Drop 21%

WTF?!?! I just hired on with this company?! What the hell have I gotten myself into?!

 

NEW YORK (TheStreet) -- Akorn (AKRX - Get Report) shares are falling, down 20.62% to $43.85 on Monday, after the manufacturer of diagnostic and therapeutic ophthalmic pharmaceuticals amended its 2014 net revenue and pretax income figures after the closing bell on Friday.

The Lake Forest, IL-based company said that it overstated its pretax income and net revenue by between $20 million and $35 million which led analysts at Piper Jaffray to downgrade the company's outlook to "neutral" from "overweight," saying that the company had lost credibility due to the revision.

"Though management does not believe the accounting issues will impact 1Q15 results, and it is sticking with its 2015 guidance, there is in our view far too large of a credibility gap to simply take those statements at face value. We believe that significant management changes will be needed to restore Akorn's credibility and further find it difficult to envision how these missteps will not result in a change in the CFO position," said analyst David Amsellem.

TheStreet Ratings team rates AKORN INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate AKORN INC (AKRX) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, good cash flow from operations, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value."

 

What do they mean by significant management changes??? Could it be the removal of the crown king & prince ( Raj & Bruce )????? One could only hope..............

 

Today's Dead Cat Bounce Stock: Akorn (AKRX)
ByDavid AferiatFollow | 04/28/15 - 09:54 AM EDT
Get TheStreet Quant Ratings' exclusive 5-page report for (AKRX) now.
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Akorn ( AKRX) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Akorn as such a stock due to the following factors:

AKRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $132.6 million.
AKRX has traded 238,903 shares today.
AKRX is up 3.5% today.
AKRX was down 22% yesterday.
- See more at: http://www.thestreet.com/story/13128983/1/todays-dead-cat-bounce-stock-akorn-akrx.html?puc=aol&cm_ven=aol#sthash.bEnn3r06.dpuf

 

Future isn't so bleak..........Akorn, Inc. (AKRX) announced on Friday that it will have to restate financials from 2014 due to accounting errors. Akorn warned that their financial reports for 2014, filed by KMPG, should not be relied upon. Though the pharmaceutical company affirmed its 2015 earnings per share guidance, the stock fell by more than 20% on Monday following the announcement.

Akorn identified the 2014 accounting missteps when reviewing financials for the first quarter of 2015. The miscalculations stemmed from understatements of rebates and other sales allowances. Though the company is still determining the exact impact of the miscalculations, initial estimates believe the errors resulted in a $20 million to $35 million overstatement of net revenue and pre-tax income for the full-year 2014.

Consequently, Akorn warned investors that it does not expect to file its quarterly report by the SEC deadline. However, Akorn affirmed guidance for 2015 earnings, expecting to post adjusted diluted EPS between $1.88 and $1.98.

On April 27, Akorn announced recent executive appointments including Randall Pollard who was appointed Corporate Controller. In this role, Pollard will oversee all accounting and financial reporting.

Analysts weighed in on the impact the flawed accounting will have on the pharmaceutical company.

On Monday, analyst David Steinberg reaffirmed a Buy rating on Akorn, though he did not provide a price target. Steinberg does not think the accounting errors will have a significant impact on the stock. He has rated Akorn once before on April 20, when he set a $56 price target for the stock. He was bullish on Akorn because he believed its clobetasol cream was more successful than that of Actavis’s.

 

Too bad we can't dump Jason B with all this mess. The savings from his meal bills alone would make the stock jump a point.

 

AKORN, INC. SHAREHOLDER ALERT: Kessler Topaz Meltzer & Check, LLP Announces Update to Shareholder Class Action Against Akorn, Inc. and Reminds Shareholders of Impending Deadline-- AKRX
PR Newswire Kessler Topaz Meltzer & Check, LLP

RADNOR, Pa., April 30, 2015 /PRNewswire/ -- The law firm of Kessler Topaz Meltzer & Check, LLP announces that a shareholder class action has been filed against Akorn, Inc. (AKRX) ("Akorn" or the "Company") on behalf of purchasers of the Company's securities between April 17, 2014 and March 2, 2015, inclusive (the "Class Period"), and reminds Akorn shareholders that they may, no later than May 4, 2015, petition the Court for appointment as a lead plaintiff of the class.

News isn't getting any better. Down another 5%.

 

If the stock keeps going down, what are the possible events that could follow?

 

If Stock keeps going down, we could be gobbled by one of the big guys.

 

Stock is still falling..............????

 

Who cares if the stock dips a bit. As long as my paycheck / incentive compensation check clears, that is all I care about. Let Raj & Bruce take care of the rest. Life isn't perfect here at Akorn, however what company is??

 

It's people like you who are blind to what could happen if our stock keeps falling. You need to understand the bigger picture.

 

Really? What can any of us do about it. Just go to work.

 

No one was saying the field sales force can do anything about the issue, just that they need to be aware of the consequences if the stock keeps on falling.

 

So True.... The Sales Team may not be shareholders, however we are stakeholders in the company and its future.

 

You are wrong. Most of the smart Akorn employees take advantage of the employee stock purchase plan, some have been awarded stock for their efforts and many of us have bought Akorn stock as a investment. If the stock returns to its upward growth, I will make more from it than my salary & incentive compensation put together during my tenure here.

 

"If" the queen had balls, she would be the king.

 

Wow, we have a poet on this blog......Thanks for your thoughts........

 

Pretty sad considering the salary is $55K and the incentive plan is a joke where no one makes more than a thousand or two per quarter.
Maybe I would be better off hoping wall st can put life back into this dead horse.

 

The only way things will change with our compensation is if the man upstairs makes a visit to Lake Forest during an executive meeting and makes Raj & Bruce an offer they cannot refuse.......in other words...do not hold your breath for miracles!