enCore Energy (NASDAQ: EU) Plunge 1.81% to 10-Month Low Amid Lawsuit and Governance Concerns

The share price of enCore Energy (NASDAQ: EU) plunged to a 10-month low on October 4, 2025, with an intraday decline of 3.02% and a closing drop of 1.81%. The selloff reflects mounting concerns over the company’s corporate governance and financial transparency, driven by a series of interconnected challenges that have eroded investor confidence.

A class-action lawsuit (*Zhongjian v. enCore Energy Corp.*, No. 25-cv-01234, S.D. Tex.) remains a pivotal factor. Filed under the Securities Exchange Act of 1934, the case alleges that the company and executives misled investors by concealing material weaknesses in internal controls and improper accounting practices during the class period (March 28, 2024–March 2, 2025). These disclosures, which came after a 46% stock price collapse, have intensified scrutiny over the firm’s financial reporting framework.

EnCore Energy’s fiscal 2024 results further underscored its struggles, with a net loss of $61.3 million—more than double the prior year’s figure. The lawsuit highlights the company’s failure to capitalize exploratory and development costs under U.S. GAAP, a deviation that exacerbated expenses and signaled operational inefficiencies. This accounting discrepancy has raised questions about the sustainability of its business model.

Compounding these issues, the firm disclosed a “material weakness” in internal controls over financial reporting in 2024. The deficiency in risk assessment and monitoring processes has heightened fears of potential errors or fraud, further undermining trust in its governance structure. Such weaknesses are often seen as a red flag by investors and regulators alike.

Leadership instability also played a role in the market’s pessimism. In March 2025, CEO Paul Goranson stepped down, succeeded by Robert Willette as acting CEO. The abrupt transition, coupled with ongoing legal and financial crises, has fueled speculation about internal discord and the company’s ability to execute its strategic vision.

Investor and legal responses have amplified the pressure. Hagens Berman, the lead firm in the lawsuit, is actively soliciting investor losses and whistleblower information, signaling broader regulatory interest. The SEC Whistleblower Program has also been referenced as a potential avenue for those with non-public insights, indicating a deepening probe into the company’s practices.

While recent capital-raising efforts—such as an $115 million convertible notes offering in August 2025—suggest attempts to stabilize finances, these measures have failed to restore market confidence. The cumulative impact of legal, financial, and governance risks continues to weigh heavily on the stock, with investors likely to remain cautious until the company demonstrates tangible improvements in transparency and operational discipline.