ADMA Biologics Plunge 4.57% as Auditor Resignation Sparks Governance Fears

ADMA Biologics (ADMA) shares hit an intraday low of 0.85% today, marking their weakest level since March 2025. The stock has fallen 0.57% over two consecutive trading sessions, with a cumulative decline of 4.57% in the past two days, underperforming broader market trends and the medical sector.

The recent volatility is attributed to the abrupt resignation of CohnReznick LLP, ADMA’s independent auditor, disclosed via an SEC filing. The resignation, which occurred without prior approval from the company’s board or audit committee, has raised concerns about financial reporting integrity and corporate governance. While the firm reaffirmed its 2024 and 2025 revenue guidance ($400 million and $445 million, respectively), the lack of transparency around the auditor transition has eroded investor confidence, triggering sharp sell-offs.

Despite strong institutional ownership—75.68% of shares held by large investors—the recent drop in trading volume (38% below the 30-day average) suggests cautious positioning. Institutional investors, including entities like Cullen Frost Bankers Inc., have increased stakes in prior quarters, but these moves predate the recent downturn. Analysts project 6.67% year-over-year EPS growth and $506.7 million in annual revenue, yet the stock’s forward P/E ratio of 28.26, above the industry average of 19.79, indicates overvaluation concerns.

ADMA’s product pipeline, including BIVIGAM and ASCENIV for immune deficiencies, remains a long-term strength. However, the auditor resignation has overshadowed recent operational progress, such as 13.8% year-over-year Q2 revenue growth. The company’s IBD 50 listing, which previously drove a 350% stock surge this year, now faces headwinds as governance risks dominate market sentiment.

Looking ahead, ADMA must address regulatory scrutiny risks and demonstrate consistent execution to restore investor trust. While the firm maintains a Zacks Rank of #3 (Hold) and strong liquidity metrics (current ratio of 5.33), unresolved governance issues could prolong volatility. The stock’s underperformance against the S&P 500 and medical sector underscores lingering skepticism about its ability to meet growth expectations.