What happened
Shares of Cano Health (CANO) were down as much as 35.6% this week and were still down 31.2% for the week as of late Thursday afternoon, according to data from S&P Global Intelligence. The stock closed at $2.02 last Friday and then opened this week at $2.01.
The company's shares fell to a 52-week low of $1.30 on Thursday. The stock is down more than 84% this year.
So what
The company operates 141 senior-oriented primary care centers in California, Florida, Illinois, Texas, Nevada, and Puerto Rico.
Its shares had already been dropping since it released discouraging numbers in its third-quarter report that showed a $112 million loss. The stock fell even further after investment advisor Third Point, run by Dan Loeb, worried about Cano's liquidity, sold its remaining 3.5% stake in the company, according to a Bloomberg report.
Cano, as of the third quarter, reported only $24 million in cash and cash equivalents. The other looming worry over the stock was after initial reports of a potential buyout by CVS Health or Humana, no sale has emerged for the healthcare company.
Now what
The healthcare company's cash crunch and lack of apparent suitors makes it risky. It went public through a merger with a special purpose acquisition company (SPAC) in June of last year.
There are positives for the company if it can get more financing or find a way of returning to profitability by decreasing its medical cost ratio for Medicare Advantage and Medicaid members. It has been able to increase membership (up to 294,596 as of the third quarter), and it reported third-quarter revenue of $665 million, up 33% over 2021.
The company still has potential as a long-term investment and could still be a buyout target, particularly now that it is trading at a price-to-book value of 0.83.
