Molycorp, Inc. (NYSE: MCP) shares were holding up fine after earnings, but the company's 10-Q Filing with the Securities and Exchange Commission listed an SEC investigation that went back to the month of August. This is not the sort of issue shareholders like to find out about.
The filing noted in its Legal Proceedings section,
In August 2012, the staff of the SEC notified us that a formal order of investigation had been issued regarding, among other things, the accuracy of our public disclosures. We are cooperating with the staff of the SEC in connection with the investigation. We cannot predict the length, scope or results of the investigation or the impact, if any, of the investigation on our results of operations.
Molycorp shares were halted on a circuit-breaker drop of 10% due to the panic selling but shares are down only 4.3% at $8.31 on the day as of now. Keep in mind that this has put in a 52-week low as the prior range was $8.64 to $36.25. If you think that the drop from the 52-week high is awful, the absolute high back in May of 2011 was $79.16.
It is a fairly sad situation when the only large-scale production of rare earth elements and minerals in the United States has turned out to be such a bad investment.
JON C. OGG
Filed under: 24/7 Wall St. Wire, Accounting, Corporate Governance, Metals, Regulation, SEC Tagged: MCP