Short Seller Alert : KBR, Inc. (NYSE:KBR) .
There is a constant short selling pattern with the KBR stocks . This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share .
The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Construction & Engineering industry. The net income has significantly decreased by 877.2% when compared to the same quarter one year ago, falling from -$127.00 million to -$1,241.00 million.Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior.Net operating cash flow has significantly decreased . Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year . Consistent with the plunge in the stock price, the company's earnings per share are down 896.51% compared to the year-earlier quarter. The company has reported a trend of declining earnings per share over the past two years.
The Securities and Exchange Commission on Wednesday charged technology and engineering firm KBR Inc. with breaking a whistleblower-protection rule enacted by the Dodd-Frank Act.
In what is being called a landmark ruling for whistleblowers, the Securities and Exchange Commission announced Wednesday that one of the nation's largest government contractors used confidentiality agreements that had the potential to intimidate and "muzzle" workers from reporting allegations of fraud.The SEC said this was its first enforcement action against a company for using "improperly restrictive language" in agreements with potential to stifle whistleblowing.
The ruling involving Kellogg Brown & Root, also known as KBR, sends a powerful signal to corporations that the improper use of confidentiality agreements will result in civil fines and possible criminal penalties, according to legal experts.
The announcement is being hailed as a major victory for whistleblowers, shielding them from signing overly restrictive confidentiality agreements that threaten them with lawsuits and termination for reporting allegations of fraud.
The SEC said in its announcement that the ruling represented its first enforcement action against a corporation for using confidentiality agreements that could "stifle" the whistleblower process.
"By requiring its employees and former employees to sign confidentiality agreements imposing prenotification requirements before contacting the SEC, KBR potentially discouraged employees from reporting securities violations to us," said Andrew J. Ceresney, director of the SEC's Division of Enforcement. "SEC rules prohibit employers from taking measures through confidentiality, employment, severance or other type of agreements that may silence potential whistleblowers before they can reach out to the SEC. We will vigorously enforce this provision."
Lowes said KBR has agreed to pay a $130,000 fine to settle the SEC investigation and has also agreed to amend its confidentiality agreements, a step SEC officials have applauded.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.