Why GSX Techedu Is Tumbling 17% Today

Shares of GSX Techedu (NYSE: GSX) were tumbling almost 17% in morning trading Wednesday after the education company confirmed it was part of an SEC investigation into whether it had inflated its sales and user accounts. It also reported second-quarter earnings.

The Chinese online education company reported that revenue more than quadrupled in the quarter to 1.65 billion renminbi (about $233 million) as enrollment in its K-12 online course increased more than 300% year over year. But investors might be taking those numbers with a grain of salt after it disclosed it was cooperating with an SEC investigation into its finances going all the way back to 2017.

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Source Fool.com