PACS Group, Inc.(US:PACS) Prnewswireยท2024-12-12 16:44Core Viewpoint - Faruqi & Faruqi, LLP is investigating potential claims against PACS Group, Inc. due to allegations of securities law violations related to false statements and misleading practices that significantly impacted the company's financial performance and stock value [2][4]. Group 1: Company Background and Financial Events - PACS Group conducted its IPO on April 11, 2024, selling 21,428,572 shares at $21.00 per share, raising approximately $450 million in net proceeds [5]. - The company later executed a secondary public offering (SPO) on September 3, 2024, issuing 2,777,778 shares at $36.25 per share, generating $100.7 million, while insiders sold 16,256,704 shares for $589.3 million [6]. Group 2: Allegations and Investigations - The complaint against PACS Group alleges that the company engaged in a scheme to submit false Medicare claims, which accounted for over 100% of its operating and net income from 2020 to 2023 [4][7]. - Allegations also include billing for unnecessary therapies and falsifying documentation related to licensure and staffing, which misled investors about the company's operations and prospects [4][7][8]. Group 3: Stock Performance and Market Reaction - Following the release of a report by Hindenburg Research on November 4, 2024, which detailed the alleged misconduct, PACS Group's stock price fell by $11.93, or 27.78%, closing at $31.01 [8]. - On November 6, 2024, the company announced a postponement of its fiscal third quarter earnings release and disclosed receiving civil investigative demands from the federal government, leading to a further decline in stock price by $11.45, or 38.76%, closing at $18.09 [9].