Research: what happens to stocks after accounting red flags

Across 58,829 flags with a full year of price data, the median flagged stock trailed the S&P 500 (SPY) by 46.4 percentage points over the next year, and 73% did worse than SPY.

We follow every verified auditor change, restatement, late-filing notice and going-concern warning since 2015 and measure the stock's return over the next 90 days, 180 days and 1 year against the S&P 500. Start with the 10-year study of all red flags, or pick a flag type below.

Historical averages, not a prediction or investment advice.

Going-concern warnings

Going-concern warnings: across 33,713 flags with a full year of price data (2015-2026), the median stock returned -36.6% and trailed the S&P 500 (SPY) by 50.0 percentage points over the next year; 74% did worse than SPY.

Read the going-concern warnings research →

Late filings (NT 10-K / NT 10-Q)

Late filings (NT 10-K / NT 10-Q): across 16,590 flags with a full year of price data (2015-2026), the median stock returned -33.7% and trailed the S&P 500 (SPY) by 46.8 percentage points over the next year; 74% did worse than SPY.

Read the late filings research →

Auditor changes (8-K Item 4.01)

Auditor changes (8-K Item 4.01): across 4,893 flags with a full year of price data (2015-2026), the median stock returned -18.5% and trailed the S&P 500 (SPY) by 32.2 percentage points over the next year; 70% did worse than SPY.

Read the auditor changes research →

Restatements (8-K Item 4.02)

Restatements (8-K Item 4.02): across 1,713 flags with a full year of price data (2015-2026), the median stock returned -9.7% and trailed the S&P 500 (SPY) by 23.9 percentage points over the next year; 61% did worse than SPY.

Read the restatements research →

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