Valeant Corrects Guidance Error Hours After Earnings Release: What Happened?
Valeant Pharmaceuticals Intl Inc (NYSE: VRX) continues to fall more than an hour after the company issued a correction to its Tuesday morning earnings release. Upon reporting, Valeant initially said it expected adjusted EBITDA to be between $6.2 billion and $6.6 billion for the next four quarters (Q2 2016 through Q1 2017).
An hour into the trading session, Valeant's correction said this forecast was given "inadvertently." Its revised next-four quarter EBITDA outlook is $6 billion.
While an earnings miss and lowered EPS and revenue outlook sent shares below $47 per share, the latest correction spooked investors even further; the stock is now under the $38 level.
In a mid-morning conference call, the company said future price increases will be more modest, in line with industry practices. A fellow biotech CEO recently told Benzinga Valeant can be blamed for "[inventing] the model" for hiking prices on drugs with no competition; Hillary Clinton has criticized the company for similar practices.
On Tuesday, Valeant also said the company would consider a sale of its non-strategic assets, reaffirmed that a regulatory investigation into Philidor accounting is ongoing and added that the company is changing its tax reporting method after SEC suggestions to do so.
Shares are now far below Citron's Andrew Left's $50 price target given last fall.
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