Two law firms have announced they are investigating Morehead-based company AppHarvest for potential federal securities law violations.
A press release from firm Bragar Eagel & Squire Thursday says they are also investigating if the company engaged in unlawful business practices. The move comes after the company reported a $32-million net loss in the second quarter ending June 30, 2021. Stock prices dove 20.55% after the loss was made public. AppHarvest has also scaled back its sales goals for the year. Original estimates were between $20mil-$25mil…now they are between $7mil-$9-mil. Yahoo! Finance posted a similar release from firm Block & Leviton, saying they are investigating potential violations as well.
The Herald Leader reports the company is facing a few issues. Among them are a 10-year low in tomato prices in May of this year and the quality of tomatoes grown being lower than expected. C.E.O Jonathan Webb cited scaling up the Morehead facility to 400 employees as a challenge, saying training that many people to hit the yield and quality has been difficult.
AppHarvest entered public trade in February of this year.