Enphase Energy Inc (NASDAQ: ENPH) shares plummeted 23.2% on Wednesday after short seller Prescience Point released a new report alleging fraudulent accounting practices and predicting Enphase will ultimately be delisted.In the new report, Prescience Point claims Enphase has fabricated financial statements and SEC filings."Based on our research, we estimate that at least $205.3m of its reported US revenue in FY 2019 was fabricated. Based on statements provided by former employees and other solar industry participants, it appears that the Company inflated its international revenue significantly as well," Prescience Point alleges.In addition, the firm claims a significant portion of Enphase's gross margin expansion from the second quarter of 2017 to the first quarter of 2020 is fraudulent.Investigation Findings: Prescient Point called for regulators to investigate Enphase's accounting practices and claimed a third-party investigation of Enphase's India business revealed the following troubling findings: * Enphase is allegedly using an India-based team to carry out accounting fraud. * Nearly all of the former Enphase employees the investigator interviewed claimed the company was fabricating financial numbers. * At least one former Enphase distributor in India terminated its relationship with the company due to concerns over potentially fraudulently inflated invoices. * Employee turnover in Enphase's Bangalore office is an extremely high 70%, which Prescient Point attributes in part to Enphase's accounting practices.Original Allegations: Prescient Point previously accused Enphase of using improper deferred revenue accounting back in 2018, but the market mostly ignored the allegations and the stock continued to rise."However, given the overwhelming evidence of fraudulent behavior presented in this report, which is backed by numerous former employees, numerous solar industry participants, a forensic accountant, and reliable third-party data sources, we believe that this time will be different, and that this sham turnaround story will soon meet its inevitable, dire fate," Prescient Point said on Wednesday.In lieu of a price target, Prescience Point predicted the Enphase shares will eventually be delisted.A representative from Enphase was not immediately available for comment.Benzinga's Take: Wednesday's sell-off is a much different market reaction than the one following the initial Prescience Point report back in 2018. However, some investors may simply be taking profits on the stock just in case given it is up more than 600% in the past two years.Do you agree with this take? Email feedback@benzinga.com with your thoughts.Related Links:How Delisting Chinese Stocks Could Hurt Wall Street Market Shrugs Off Potential Delisting Of Chinese StocksLatest Ratings for ENPH DateFirmActionFromTo May 2020Goldman SachsDowngradesBuyNeutral May 2020JP MorganMaintainsOverweight May 2020B. Riley FBRMaintainsNeutral View More Analyst Ratings for ENPH View the Latest Analyst Ratings See more from Benzinga * Here's How Much Investing ,000 In Roku's 2017 IPO Would Be Worth Today * Wall Street Cautious On Oracle: 'Investors Likely Have To See The Growth Before Believing It' * This Day In Market History: Hoover Signs Smoot-Hawley Tariff Act(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Yahoo Finance’s Emily McCormick joins Melody Hahm to discuss DraftKings’ latest move to sell more shares amid the company’s strong stock performance.

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Stocks cut earlier gains, and the S&P 500 and Dow turned negative, after new data showed further spikes in coronavirus cases in some densely populated U.S. states.

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New coronavirus cases continue to spike around the globe, leading health and government officials in Austin, Texas, to extend stay-at-home orders, while Beijing announces it will close down schools and certain sectors of the economy again. Yahoo Finance’s Anjalee Khemlani breaks down the latest news about the coronavirus on The Final Round.

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Director of Investor Protection at the Consumer Federation of America Barbara Roper joins Yahoo Finance’s Zack Guzman to discuss how two recent moves from the Labor Department could make retirement saving riskier.

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2020 has seen a wave of chaos hit the stock market. Now, you can add the shenanigans surrounding bankrupt car rental company Hertz (HTZ) to the list, too.After filing for bankruptcy last month, perplexingly, Hertz stock soared by more than 1,200%, mostly as a result of speculative investors piling in on a penny stock’s momentum play. However, since peaking on June 9, the volatility has been off the charts. Last week, in sequential sessions, the stock dropped by 24%, 40%, 18%, and then climbed 37% higher following news that Hertz had inexplicably received the go ahead to issue up to $1 billion in new stock.Stunning Wall Street, Hertz was delisted from the NYSE, which has led to the coining of a new term: the IBO – Initial Bankruptcy Offering.The volatility continued on Monday as Hertz shares dropped by 33% following management’s admission in an 8-K filing that the additional $500 million worth of common stock it plans on selling will probably be “worthless.”As part of the 8-K filing, Hertz detailed its expected cash outlay for the period between May 25 and August 21, and based on a back of the envelope calculation, Deutsche Bank analyst Chris Woronka estimates the cash burn for the period will “probably be close to $1.2 billion.”Along with the equity raise, Woronka estimates Hertz will try and sell between 25-30% of its fleet to raise additional cash. With no plans to use the money to replenish its fleet, this just raises more questions concerning Hertz’ future.The analyst said, “At some point the company will need to ‘turn over’ its existing fleet and purchase new vehicles as replacements in order to offer customers a competitive product… We believe the natural cycle suggests this would likely need to occur ahead of the summer 2021 peak. It's unclear to us whether HTZ will have ample liquidity (or borrowing power) with which to fund new fleet purchases, particularly since the existing fleet will have moved further down the depreciation curve relative to where a fleet on a ‘normal’ replacement cycle would be at that time (since HTZ did not replace those vehicles with new ones this summer).”Woronka, therefore, remains on the sidelines. The Deutsche Bank analyst has a Hold rating on Hertz and “based on a 2022E free cash flow recovery scenario,” a $3 price target. Based on this target, the risk-tolerant investor could take home a 66% gain, should the target be met over the next 12 months. (To watch Woronka’s track record, click here)Overall, the Street’s view on Hertz presents a strange conundrum. On the one hand, based on 3 hold ratings, and 4 Sells, the bankrupt rental car company has a Moderate Sell consensus rating. However, the average price target of $2.63 represents possible upside of nearly 35%. (See Hertz price targets and analyst ratings on TipRanks)To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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Could the least exciting bit of Elon Musk's empire end up being the most transformative?

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It's likely to be a long, hot summer for investors in the stock market says this veteran strategist.

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(Bloomberg) — Hertz Global Holdings Inc. is facing questions from the U.S. Securities and Exchange Commission over its plans to sell as much as $500 million worth of stock that may be worthless in the midst of the car-rental company’s bankruptcy. The shares were halted Wednesday.“We have let the company know that we have comments on their disclosure,” SEC Chairman Jay Clayton said in a CNBC interview Wednesday. “In most cases when you let a company know that the SEC has comments on their disclosure, they do not go forward until those comments are resolved.”In its Monday disclosure announcing the proposed stock sale, Hertz said equity holders will not see a recovery from any bankruptcy plan unless those with more senior claims, including bondholders, are paid in full. The company said that would require a rapid and unanticipated improvement in its business outlook. The startling plan has captured the attention of Wall Street and now, securities regulators.Hertz’s shares soared as much as 21% following Clayton’s comments before retreating to $1.94, in line with Tuesday’s close. Trading was then halted at 11:44 a.m. in New York.Hertz has previously said in a court filing that a share sale could raise as much as $1 billion in cash. The company has bonds that are about $2.3 billion underwater, not including what it owes to banks and any lease payments, as well as other expenses.Clayton said Hertz was aware of the SEC’s concerns, but he declined to speculate whether the company would move forward without addressing them. “We will see,” he said.Back-and-forth with SEC attorneys who review corporate filings isn’t uncommon when a company seeks to sell shares, and doesn’t necessarily mean the regulator will reject a proposal. Still, Hertz’s plan is unusual because of its ongoing bankruptcy and stark warning to prospective investors.Hertz didn’t respond to a request for comment.(Updates with information on SEC review in seventh paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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