Flotek Industries Slumps After Short Seller Wolfpack Takes Aim at Puerto Rico Deal

Shares of Flotek Industries fell sharply after Wolfpack Research announced a short position and alleged a $400M Puerto Rico deal was canceled.

August 26, 2026

What happened

Flotek Industries (NYSE: FTK), a Houston-based specialty chemicals company serving the oil and gas industry, saw its stock fall about 21% on Monday after short seller Wolfpack Research announced it had taken a short position in the company, according to Investing.com. The stock traded at $27.86 in afternoon trading, down 22.3%, per another Investing.com report.

Wolfpack Research alleged that Flotek's $400 million deal with Puerto Rico's PREPA and Power Expectations has been canceled due to an unauthorized signature that has been referred for criminal investigation, wiping out a significant portion of the company's near-term backlog. The firm also claimed that Flotek has not yet disclosed this to investors.

The claims come from a post on X by Wolfpack Research (@WolfpackReports). While the company has not filed any SEC documents regarding the matter, the stock price drop is confirmed by the price data provided (close of $24.00 on the event date, down from $24.00? Actually, the provided close is $24.00 with a change of only 0.33%, which does not reflect the 21% drop mentioned. This discrepancy may be due to different dates or data sources. The web searches clearly report a significant drop on the event date.

Background

Flotek Industries, Inc. is a specialty chemicals company that provides technology and chemicals to the energy industry, primarily for oil and gas drilling and production. The company has a market presence in miscellaneous chemical products.

The Puerto Rico deal with PREPA (Puerto Rico Electric Power Authority) and Power Expectations was previously seen as a major growth opportunity for Flotek. According to Seeking Alpha, the company had outlined $340 million to $350 million in 2026 revenue and $47 million to $51 million in adjusted EBITDA, with the Puerto Rico deal adding approximately $400 million in backlog.

The deal was part of Flotek's recent earnings outlook, as reported by Simply Wall St., which noted the company raised its 2026 guidance after strong second-quarter results.

What this means

A short seller is an investor who bets that a stock will decline in value. Wolfpack Research announced it is short FTK, meaning it has taken a position that profits if the stock falls. Short sellers typically publish research alleging problems with a company to drive the price down, which can be controversial and sometimes inaccurate, but in this case the stock did fall sharply on the announcement.

The claim about the canceled deal is critical because it represents a large portion of Flotek's near-term backlog. If true, it could materially impact the company's revenue outlook. The alleged unauthorized signature refers to a situation where a document was signed without proper authority, and the referral to a criminal investigation suggests potential wrongdoing, though these are unverified allegations from Wolfpack.

Normally, when a company loses a major contract, it is required to disclose this in a timely manner through an SEC filing, such as an 8-K, to inform investors. The fact that no filing has appeared may indicate that the company is still evaluating the situation or that the claims are unfounded. Investors should monitor for any official company statements or SEC filings for confirmation.

Sources

Information summarized by AI from the sources listed above. May contain errors — informational only, not investment advice.