American Realty Capital Properties Inc. (NASDAQ: ARCP) announced Wednesday morning that its previously issued financial statements and other financial information should no longer be relied upon. This is not just one statement, mind you. This is reaching back as far as December’s 2013 fiscal year statement.
As a result, there is now an ongoing investigation by the firm Bronstein, Gewirtz & Grossman. The firm is investigating if certain officers and/or directors have violated sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
Simultaneously, the company announced that Brian Block will be replaced by Michael Sodo as chief financial officer and that Lisa McAlister will be replaced by Gavin Brandon as chief accounting officer. These replacements were effective immediately.
American Realty claims that this will not affect the current dividends for 2014. However, when there is financial distress that might appear far reaching in this case, it can cause some serious concern among investors, especially regarding dividends.
Shares on the day fell about 35% to $8.09 in the noon hour, following this announcement from earlier in the morning. It is also worth noting that the stock on average trades 10 million shares a day, compared to roughly 120 million thus far on Wednesday.
ALSO READ: The 10 Safest High-Yield Dividends
Despite the company saying that the current dividend is secure, a 30% drop in the share price would make one wonder if future dividends are at risk.
The consensus analyst price target is $15.04, and the 52-week trading range is $7.85 to $14.96. The company has a market cap of about $7 billion.
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.