Cano Health, Inc. (CANO) Had to Restate its Financials for Year Ended December 31, 2021
A shareholder filed a class action on behalf of persons and entities that purchased or otherwise acquired Cano Health, Inc. (NYSE: CANO) securities between May 18, 2020 and February 25, 2022, for violations of the Securities Exchange Act of 1934. Cano provides primary care medical services to its members in the U.S. and Puerto Rico.
According to the complaint, on June 3, 2021, Jaws Acquisition Corp. consummated a merger with Primary Care (ITC) Intermediate Holdings, LLC, whereby Jaws changed its name to Cano Health, Inc. and began to provide primary care medical services.
On February 28, 2022, Cano announced “it will delay its fourth quarter and full year 2021 earnings release, conference call and 2022 guidance updates, previously scheduled for Monday, February 28, 2022.” Cano advised that “in the course of finalizing its audit of the financial statements for the year ended December 31, 2021, the Company and its independent auditor … identified certain potential non-cash adjustments to account for revenue recognition under accounting standard ASC 606.” Specifically, Cano advised that “[t]he adjustments relate to how and when the Company accrues revenue related to Medicare Risk Adjustments” and that “[t]he adjustments are expected to impact the timing of revenue recognition, by delaying recognition of certain amounts related to the Medicare Risk Adjustment to subsequent periods[.]” On this news, Cano’s Class A common stock price fell over 6% on February 28, 2022.
When the Company filed its annual report for the quarter and year ended December 31, 2021, it “restated its financial statements for each of the quarterly periods ended March 31, 2021, June 30, 2021 and September 30, 2021 in the [2021 10-K.]” Notably, the 2021 10-K reported that, as restated, capitated revenue decreased 2.13% for the three months ended March 31, 2021; 13.11% for the three months ended June 30, 2021; and 5.58% for the three months ended September 30, 2021.
Next Steps: If you acquired shares of Cano Health, Inc. (CANO) between May 18, 2020 and February 25, 2022, you have until May 17, 2022, to ask the court to appoint you lead plaintiff for the class. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.