Shares of Symbol fell 17 percent, to $8.88, in after-hours trading Thursday after it said the staff of the U.S. Securities and Exchange Commission may recommend civil actions against the company related to a previously announced probe into past accounting practices.
The company, which makes wireless systems to read bar codes, also said it was delaying a restatement of its financial results.
The drop in share price came after the company's stock soared 11.5 percent in regular trading Thursday. Symbol seemed to benefit from a U.S. Food and Drug Administration proposal Thursday to mandate bar codes on drug products to reduce medication errors.
Just after trading closed Thursday, Holtsville, N.Y.-based Symbol said it and a number of former employees had received notice that the SEC staff may recommend civil actions alleging violations of federal securities rules.
The company said it is reviewing the notice and is in the process of responding to the SEC. Symbol also said that although it had expected to complete its restatement of previously reported financial results by the end of this month, it now anticipates completing the restatement in June.
Though the news seemed to scare investors late Thursday, earlier the stock was a darling. J.P. Morgan issued a report saying that Symbol could get a boost from the FDA proposal.
"We believe Symbol has been working with the FDA for nearly a year on definition of bar code standards for applications of this kind," the investment company said. "We believe the company is poised to be a beneficiary of this major initiative."