21Vianet Group Inc (NASDAQ:VNET) stock registered growth as CEO, Josh Chen, released 91 pages of financial information denying claims of fraud leveled against the company by Trinity Research Group.
The Chinese data-center operator was accused of overstating its business and using financings and acquisitions to inflate growth. Trinity Research Group said that it believes that the company will soon be delisted by NASDAQ for fraudulent practices in both its accounting and insurance practices.
Although 21Vianet Group Inc (NASDAQ:VNET) stock had slightly slipped, it has registered gains, advancing 8% to trade at $21.46 in New York on September 12. The company continued receiving bullish calls from representative of entities such as Morgan Stanley to Credit Suisse Group AG.
Besides the detailed report released by 21Vianet Group Inc (NASDAQ:VNET) through the company’s website, the CEO, who’s also a co-founder, wrote a passionate letter to shareholders refuting the claims. He said that the company represents “the vast majority of his emotional and financial resources” and is his “life’s work and passion.”
“It’s more about confidence boosting than the information that’s cited there,” Cheng Cheng, an analyst at Pacific Crest Securities LLC., said by phone from Portland, Oregon. “You sign your name, and there’s a certain expectation that if it’s not true, there could be other repercussions.”
CLSA Ltd. started covering 21Vianet Group Inc (NASDAQ:VNET) today. The company has been established to possess the 4th best regional recommendation consensus among peers in the internet software and services industry. Cher Chen, CLSA Ltd. analyst has projected a 98% gain on its September 12 value within 12 months. They have estimated a 50% increment in sales for the same period.
Several other analysts also concur that 21Vianet Group Inc (NASDAQ:VNET) stock will continue to gain in spite of the leveled accusations.
This article has been written by Victor Ochieng.