Update: Valeant Plunges 7% Following Scathing Wells Fargo Report

Shares of

opened for trading on Friday at $90.48 and moved lower throughout the morning trading session. After nearly 2 full hours of trading, the stock had lost more than 7 percent and hit an intra-day low of $69.33. Valeant closed for trading at $94.11 on Thursday. Investors were reacting to a negative report by Wells Fargo's David Maris who initiated coverage of Valeant with an Unperform rating and valuation range of $65 to $68, implying a potential downside of more than 40 percent. Related Link:

Maris also

that Valeant had a 58 percent chance of bankruptcy last year based on an Altman z-score analysis. According to Maris, an Altman Z-score below 1.8 is a signal of financial distress, and Valeant's Altman Z-score has been below this threshold for each of the last five years. Valeant's current score is only 0.79, which suggests a bankruptcy probability of 58.4 percent.