By Sam Boughedda
Shares of agilon health Inc (NYSE:AGL) fell over 5% Wednesday after Citron Research released a short report with a $5 per share price target.
agilon, which currently trades at over $25 per share, down over 2% at the time of writing, is "exploiting short-term loopholes in Medicare /Primary Care," according to Citron.
They outlined a further three key points for the short report, including the company having a business model "designed for abuse," its "history of abuse," and the company having a "nosebleed valuation relative to competitors."
"By signing up an Accountable Care Organization (ACO) to its platform, agilon can switch a senior citizen's level of healthcare without their permission. A practice that has caused a stir in the US healthcare system. This loophole has opened the door for private equity to try and arbitrage the health benefits of America's seniors and has been referred to as 'the biggest threat to Medicare you've never even heard of,'" said Citron.
"Citron believes this multi-billion-dollar loophole company will either not exist or be a fraction of itself five years from now as the government dynamically changes Medicare law and increases enforcement on these middlemen," they concluded.