Critical Path Halted After Sharp Drop in Preopen

Internet email software company Critical Path (CPTH Quote) was still halted at midday after the stock fell 62% in preopen Island trading.

Critical Path's board said it formed a committee to investigate its revenue recognition practices and it put the company's president on administrative leave. Critical Path also said its fourth-quarter results may have been "materially misstated." The company posted a surprise loss Jan. 18, sending its shares plunging as much as 55% the next day.

The stock, which closed Thursday at $10.06, is down from a March 2000 high of $119.50. SG Cowen today downgraded it to neutral from buy. Lehman Brothers cut it to market perform from strong buy.