Bright Health is in danger of being delisted due to stock price
Overall stock prices were down by 700 points Thursday morning on the news of a half-point rate hike and potentially more increases to come.
Photo: Kiyoshi Hijiki/Getty Images
Bright Health Group is in danger of being delisted by the New York Stock Exchange.
On December 6, the Minneapolis-based insurance company received written notice from the New York Stock Exchange that it was not in compliance with the continued listing standard as the average closing price of its common stock was less than $1 per share over a consecutive 30 trading-day period ending December 2.
During a cure period, Bright Health's common stock will continue to trade on the NYSE, subject to its compliance with its other continued listing requirements, according to a statement from the company. The notice does not affect ongoing business operations or its U.S. Securities and Exchange Commission reporting requirements, nor does it cause an event of default under any of the company's debt obligations.
Bright Health said it has responded to the NYSE with respect to its intent to cure the deficiency.
WHY THIS MATTERS
Bright Health reported financial losses last year. Since going public in June 2021 and raising close to $1 billion in an initial public offering, it reported a $1.2 billion loss at the close of last year.
In recent months, Bright Health said it was curbing Medicare Advantage expansion plans and exiting individual and family plan markets in six states.
In Monday's announcement of the NYSE warning, the company said it intends to consider available alternatives, including, but not limited to, a reverse stock split, if necessary, to regain compliance.
Bright Health has a period of six months following the receipt of the notice to regain compliance with the minimum share price requirement.
Regaining compliance means that during the six-month cure period, the common stock has a closing share price of at least $1 and an average closing share price of at least $1 over the 30 trading-day period ending on the last trading day of that month.
If the company is unable to regain compliance with the $1 share price rule within this period, the NYSE will initiate procedures to suspend and delist the Common Stock.
THE LARGER TREND
On Thursday morning, Bright Health Group's stock price was $.53 and rose to $.54 by 11 a.m.
Overall stock prices took a dive Thursday morning, a day after the Federal Reserve raised interest rates by half a point and increased its estimate of how high rates may have to go to bring down inflation, according to The Wall Street Journal.
The Dow Jones Industrial Average was down almost 700 points soon after the open, and the other major indexes were also down 2% or more, the WSJ report said.
This is the Fed's seventh rate hike this year.
Twitter: @SusanJMorse
Email the writer: SMorse@himss.org
