Oscorp shares slide 6% after lab fire
A fire on the 38th floor of the company's Midtown tower was out in 20 minutes. The stock took longer. The company says nothing "of significance" was lost. Analysts want to know what that means.
Shares in Oscorp Industries fell 6 percent on Friday, their biggest one-day drop in three years, after a fire in a research laboratory on the 38th floor of the company's Midtown tower on Thursday evening.
The fire was reported at 6:31 p.m. and was out by 6:50. Nobody was hurt. Two floors were evacuated. The company said in a statement on Friday morning that the fire was "contained to a single laboratory" and that "no materials of significance" were lost.
The stock opened down 4 percent, fell further after the statement, and closed down 6 percent at $142.10.
What burned
Oscorp has not said what the laboratory was used for. A company spokesperson said it was "general research" and that the cause of the fire was under investigation. The Fire Department said the fire began in "equipment" and that there were "no unusual materials present," then clarified an hour later that it meant no unusual materials "that we were told about."
“'Nothing of significance' is a phrase that costs a company 6 percent. 'Nothing' would have cost 2.”
Analyst, Midtown brokerage
Analysts said the phrase "no materials of significance" did more damage than the fire. "'Nothing of significance' is a phrase that costs a company 6 percent," one said. "'Nothing' would have cost 2. The market heard the word they didn't say."
The tower
The Oscorp tower has had a difficult year. In April a window on the 50th floor was replaced after what the company called "weather" and what the Bugle's photographer called "a guy." In July the building's helipad was closed for a week for "surface repairs." The company has declined to comment on either incident beyond its original statements.
The chairman
Oscorp's chairman was not in the building on Thursday. A spokesperson said he was "travelling" and would address the fire at the company's quarterly call next month. One analyst said that was "about three weeks later than the market would like."
What's next
Oscorp will file a report with regulators within four days describing any material impact of the fire. If the report says "none," analysts expect the stock to recover most of Friday's loss. If it says anything else, they expect to read it very carefully.