Why Flotek Industries Inc's Stock Got Crushed Today

By Travis HoiumFool.com

What: Shares of Flotek Industries Inc plunged a whopping 36% today after it disclosed that one of its most important products may not perform as planned.

So what: A recent report questioning the validity of Flotek's FracMax analysis was acknowledged by the company, which said it miscalculated projected well production. In this case, it actually underestimated the production of wells analyzed, although the company contends that its Complex nano-Fluid technology used in the wells still produced a positive result for the customer.

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Now what: A release from Flotek today basically admits that FracMax isn't performing as well as it should be and that data proving CnF's value may not be as positive as once thought. At the very least, that calls into question the company's claims for two very important products and could negatively impact sales in the future.

With the company losing money so far in 2015, that puts investors in a tough position. No one knows how the questions surrounding FracMax and CnF will play out, but with only downside risk based on recent data, I think this is a stock to avoid right now.

The article Why Flotek Industries Inc's Stock Got Crushed Today originally appeared on Fool.com.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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