Primerica, Inc. (NYSE:PRI) shares have turned lower Thursday after the Bear Cave issued a fresh short report on the stock.
What Happened: Short-selling firm the Bear Cave has targeted Primerica stock in a new bearish report claiming the company's highest-producing agents are engaged in misleading, false, or deceptive behavior.
The short seller noted Primerica explicitly states that its business model, which involved deploying life insurance-licensed sales representatives to provide financial products and services to middle-income households, was "not a pyramid scheme."
"The Bear Cave sees things differently," the short seller said.
Benzinga reached out to Primerica for comment, but has not yet received a response.
The Bear Cave said it reviewed extensive evidence that suggested Primerica's agents were engaging in deceptive conduct including a recorded Zoom presentation that appeared to suggest an internal investigation was ongoing. Other evidence included a recruiting script for new agents that appeared to deliberately obfuscate their association with Primerica, agent presentations that emphasize recruiting and more.
"One text message recruiting script for Primerica agents, obtained by The Bear Cave through online searches, even appears to conceal the role of Primerica and instead instructs recruits to say the company is 'PFS Inc,' potentially so friends and family won't find the voluminous online criticism of Primerica," the short seller said.
Beyond aggressive recruiting, the Bear Cave claimed some top agents also appear concerned about cultural integrity issues at the company, noting that one million dollar earner asked questions about dishonest business practices in a recorded Zoom call from 2023.
The Bear Cave also said it obtained complaints against Primerica through a public records request filed with the Florida Attorney General's Office.
"Primerica customers aren't the only ones complaining. Across blogs, Reddit, and YouTube many ex-Primerica agents are sharing their bad Primerica experiences. And on Glassdoor many of the reviews are no better," the Bear Cave said.
Primerica had a market cap of approximately $7.34 billion as of Wednesday's close.
PRI Price Action: Primerica shares were down 8.94% at $192.72 at the time of publication, according to Benzinga Pro.
This illustration was generated using artificial intelligence via Midjourney.