Essential Utilities’ WTRG, +2.27% stock declined as much as 3% on Wednesday after U.S.-based short seller Spruce Point Capital Management published a report into the utilities firm.
The New York-based investment manager, led by Ben Axler, issued concerns over the “efficacy” of the U.S. water, wastewater and natural gas provider’s business model and the “accuracy” of its financial reporting.
The stock initially fell as low as 3% to $40.64 and later rose 2% higher to $42.40 per share.
The 106-page report issued a “strong sell” opinion, with a 35%-50% downside risk.
An Essential Utilities spokesperson said in a statement: “We believe the Spruce Point Capital opinion report on Essential’s stock is a misleading report. Spruce Point Capital is a hedge fund known for launching negative campaigns against companies after taking a short position in the company’s stock.”
This article was originally published by Marketwatch.com. Read the original article here.