Sign up to create alerts for Instruments,
Economic Events and content by followed authors
Free Sign Up Already have an account? Sign In
Hhthed Shshs
Nov 12, 2019 11:43AM ET
mr. beary
0
0
Quotes
All Instrument Types
- All Instrument Types
- Indices
- Equities
- ETFs
- Funds
- Commodities
- Currencies
- Crypto
- Bonds
- Certificates
Please try another search
💎 Reveal Undervalued Stocks Hiding in Any Market Get Started
Diplomat Pharmacy plunges after warning of 'going concern' risk
© Reuters. Diplomat Pharmacy plunges after warning of 'going concern' risk
(Reuters) - Diplomat Pharmacy Inc (N:DPLO) on Tuesday warned about its ability to continue as a going concern amid struggles with its pharmacy benefits management business, sending the company's shares falling more than 50% to a record low.
Flint, Michigan-based Diplomat, facing customer losses in its PBM business in the face of intense competition, earlier this year said it was reviewing options including a sale of the whole company.
The company, which started out in 1975 as a neighborhood pharmacy and also provides specialty pharmacy services, forayed into the PBM business in 2017 with back-to-back purchases of LDI Integrated Pharmacy Services and National Pharmaceutical Services.
"Strategic alternatives process seems to have transitioned to distressed sale," Baird analyst Eric Coldwell said in a client note.
"This is a very bad update as Diplomat seems to be nearing the end of its current incarnation."
The company said it may not be able to meet certain covenants in its credit agreements, which would give lenders the right to terminate funding for the company's line of credit and accelerate its debt.
Diplomat said it intends to work with its lenders to renegotiate the covenants but this uncertainty will lead to its quarterly filing with U.S. security regulators to include commentary expressing "substantial doubts" about its ability to function as a going concern.
Diplomat also said there had been interest in both the whole company and its businesses and that it was engaged in advanced discussions.
The company's stock, down 54.5% at $2.82, was the second-biggest percentage loser across U.S. exchanges in early trading.
Related Articles
Comments (1)
Add Chart to Comment
Confirm Block
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
Report this comment
I feel that this comment is:
Comment flagged
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.