It's unclear at this point what Mallinckrodt's path forward is. The company is incredibly inexpensive at just six times forward earnings, but there's uncertainty about whether or not Congress might try to throw the book, so to speak, at Mallinckrodt for its pricing practices. It's also possible that, with alleged price-gouging pharma companies being thrown into the spotlight, pharmacy-benefit managers and insurers may begin to push back.
I'd suggest investors keep their distance from this potentially messy situation.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
The article Mallinckrodt PLC Shares Get Hammered Again -- Here's Why originally appeared on Fool.com.
Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen nameTMFUltraLong, track every pick he makes under the screen nameTrackUltraLong, and check him out on Twitter, where he goes by the handle@TMFUltraLong.The Motley Fool owns shares of and recommends Valeant Pharmaceuticals. 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 .
Copyright © 1995 - 2016 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.