Ardent Health Stock Plunges 33% After $97 Million Accounting Estimate Change Triggers Shareholder Investigation
Ardent Health Discloses $97 Million Accounting Adjustment
Ardent Health, Inc. (NYSE: ARDT) saw its stock price collapse by more than 33% after the company disclosed significant adverse accounting adjustments totaling $97 million in its third-quarter 2025 financial filings. The dramatic decline reflects deep investor concern over the materiality of the adjustment and the underlying financial health of the healthcare provider.
The adjustment is reportedly tied to a change in accounting estimates concerning chronic payor denials and issues related to collectability. This substantial reserve issue immediately wiped out a significant portion of the company’s market capitalization, with the stock closing recently at $8.76, sharply down from its two-year high of $20.19.
Shareholder Investigation Launched
The disclosure has triggered an investigation by prominent shareholder rights law firm Hagens Berman into potential securities law violations. The firm is scrutinizing whether Ardent Health’s leadership was adequately aware of the extent of the collectability and payor denial issues before the Q3 2025 disclosure.
Lead Partner Reed Kathrein: Scrutiny Focuses on Extent of Leadership Awareness Regarding Chronic Payor Denials and Collectability Issues
The investigation, announced on December 23, 2025, suggests that the firm is looking into whether the company failed to disclose material information that could have impacted investors' decisions prior to the massive adjustment.
ARDT Financial Performance Under Pressure
The recent stock plunge exacerbates an already difficult period for ARDT shareholders. Financial analysis over the past two years reveals significant underperformance:
- The Total Return (2 years) stands at -45.49%.
- The Annualized Return (2 years) is -26.17%.
- The stock’s average close price over the two-year period was $14.50, significantly higher than the latest close price of $8.76.
- The Sharpe Ratio (2 years) is a negative -9.72, indicating poor risk-adjusted returns.
The latest open price was $8.81, with the latest close price settling at $8.76. The volume traded over the last two years totals 150,362,696 shares, reflecting substantial market activity even amidst the decline.
Market Impact and Forward Outlook
The 33% single-day drop underscores the market's sensitivity to accounting integrity, particularly in the healthcare sector where revenue cycle management is complex. A $97 million change in accounting estimates suggests a material misstatement or a significant deterioration in the company's ability to collect receivables, likely due to increased scrutiny or denial rates from insurance payors.
For investors, the immediate risk centers on the potential for further financial restatements or litigation stemming from the Hagens Berman investigation. The negative sentiment is reflected in the stock's performance, which has seen its lowest close price reach $8.28 recently. Until the full scope of the accounting issues is clarified and management provides a credible plan to address the chronic payor denials, Ardent Health shares are likely to remain under severe pressure.
