Stock for Performant Financial Corporation (NASDAQ: PFMT) saw wild swings in the aftermarket, keeping market participants on their toes. The regular trade session saw little movement, with PFMT moving upwards by a slight 1.52%. The volatile after-hours immediately brought a 7.5% upward jolt, followed by an 11.63% plummet. Later on, the stock shot up by 18%, with little activity between these jolts. The market movement presumably comes as a response to yesterday’s press release detailing financial results, along with important business updates.
Financial Red-Flags for PFMT
The technology-assisted recovery and analytics service provider, Performant Financial displayed concerning results, based on a number of critical metrics. For instance, last year’s revenue figure of $124.4M was 20% lower than the $155.9M reported in 2020. Within overall 2021 revenue, however, the healthcare revenue segment increased by 13% to $77.5M.
The most concerning red flag from the financial results, in addition to negative revenue growth, was the reported net loss. The net loss of $10.3M, although less than the $14.0M of the preceding year, raises serious investor concerns. For a stock valued by the market at $2 per share, a net loss of $0.17 per diluted share does not instill sufficient confidence amongst traders. These realities point to the drivers behind the hard PFMT plummets in the after-hours.
Promotion of Simeon Kohl to Performant President
Last week, Performant announced the promotion of Simeon Kohl to the position of president. Formerly, Kohl was in charge of the healthcare segment, which saw remarkable growth. Given his expertise, Kohl is expected to strategically push PFMT towards a growth trajectory. The move indicates a shift in approach and a commitment to enhancing shareholder value through a strategic vision. Moreover, it reinforces the company’s stance on prioritizing the healthcare payments segment. The executive leadership remains optimistic, factoring in the small firm size, against established competitors within the market.
Conclusion
PFMT has been going through tumultuous swings in both directions, following the close of yesterday’s trade session. These jolts in movement link to concerning financial results put forward by the company. Moreover, the promotion of Simeon Kohl to the position of company president has influenced the PFMT movement. Market response has clearly been mixed, as an outcome of these core factors. This explains why sudden jolts in high volumes continue to shape the stock’s trajectory.
