By Dominic Jones
I DON’T know if this is new or if I just haven’t seen it before, but Yahoo! Finance is posting prominent cautions on summary pages for Nasdaq companies that are behind in their SEC filings.
It’s quite jarring when you first see the caution icon and bold message saying company X “is delinquent in its regulatory filings.” Which is the point I suppose. It certainly puts investors on notice that all is not well with the particular company.
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| “Move on, nothing worth seeing here” |
I did a search and quite a few companies have the same notice. They include Sapient Corporation, Ceradyne Inc., Apollo Group Inc., Semtech Corp., Applied Micro Circuits Corp. , Apple Computer Inc., NVIDIA Corp., Juniper Networks, Inc, KLA-Tencor Corp., Rambus Inc., SafeNet Inc. and VeriSign Inc.
Those are just the ones I found, but I’m betting there are more because these companies all have some recent issues in common.
They are all behind in their filings with the SEC due to ongoing probes into their stock option practices. They are also all Nasdaq-listed companies and have received notices from the exchange indicating that they face delisting.
No warnings for NYSE companies
Interestingly, the same caution isn’t being shown for New York Stock Exchange companies that are behind in their filings.
Look at Unitedhealth Group Inc., which hasn’t filed its second quarter 10-Q and also faces a class-action suit led by The California Public Employees’ Retirement System over the firm’s stock option practices. No warning there.
Actually, if you recently bought the shares of another delinquent NYSE-listed company, BearingPoint Inc., you might now be wishing there had been a warning. A very big one, especially if you bought the stock last week after reading this opinion from Merrill Lynch.
That’s because BearingPoint’s stock dropped 24.5% in after hours trading according to Reuters. A court found the company in default on certain of its debentures because it failed to file its 10-K for the year ended Dec. 31, 2004. The company also issued an earnings warning and said it would delay filing its fiscal 2005 10-K.
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| No cautions, please. We’re NYSE-listed. |
I’m not sure why there are different standards of treatment for NYSE and Nasdaq companies that are delinquent filers. However, on the facts at hand, it does seem that investors are better protected by the Nasdaq than the NYSE on this particular score.
P.S. Ironically, delinquent filer BearingPoint is one of the companies the SEC has selected to assist in the transformation of its EDGAR database to support XBRL technology, which is supposed to speed up filings and reduce errors. Oh well…
Update: After posting this, CFO.com’s Marie Leone has continued the BearingPoint story here. I love their headline: SEC Hires Company It’s Investigating. It’s the classic Man Bites Dog headline they teach in journ school.
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