Why Oak Street Health Stock Is Plunging Today
Shares of Oak Street Health (NYSE: OSH) were plunging 19.6% as of 11:22 a.m. EST on Tuesday. The steep decline came after the company provided its third-quarter update following the market close on Monday.
Oak Street Health reported revenue of $388.7 million. This reflected a 78% year-over-year jump and easily topped the average analysts' estimate of $357.5 million. However, the primary care center operator posted a net loss of $109.9 million, or $0.49 per share. This missed the consensus estimate of a loss of $0.47 per share.
You might wonder why the healthcare stock would fall so heavily on a slight earnings miss. The bigger issue in Oak Street Health's Q3 update was that the company revealed that the U.S. Department of Justice (DOJ) is investigating whether it may have violated the False Claims Act. The DOJ has requested documents and information related to Oak Street providing free transportation to federal healthcare beneficiaries and related to its relationships with third-party marketing agents.
Source Fool.com
