Shares of Healthcare Services Group Inc. fell to a new low Wednesday after the company said its first-quarter profit dipped on lower interest rates and contract cancellations.
The stock plunged $4.72, or 23.1 percent, to $15.68 in afternoon trading. Earlier in the session shares fell to $14.54, the lowest price in nearly two years.
Late Tuesday, the Bensalem, Pa.-based provider of housekeeping, laundry and food services to the health care industry said profit fell 8 percent due to a steep drop in investment and interest income.
"The two keys to the earnings shortfall were two large contract terminations and low returns on investment balances," Morgan Keegan & Co. analyst Robert Mains said in a note to investors. "We should've seen the latter coming, with interest rates declining throughout the quarter."
