(Updates with Sportradar's response in the fourth paragraph.)
Sportradar Group (SRAD) shares fell by more than 23% in Wednesday trading after Muddy Waters Research and Callisto Research published short reports on the company.
The Muddy Waters report claims that Sportradar has "actively aided and abetted illegal gambling across the world's black and grey markets -- not as an accident or an oversight, but as a business strategy." The firm estimates that illegal operators account for about 20% to 40% of total revenue currently.
Callisto, also short Sportradar, said that based on an examination of hundreds of gambling platforms, it found evidence suggesting that over 270 individual platforms are using Sportradar's products or services, or are explicitly claiming to do so, "while operating illegally in regulated or prohibited gambling markets." A significant number of these operators have no license at all, it added.
"A short report issued today contains factual inaccuracies about the company, and we unequivocally challenge these assertions," Sportradar told, adding that the company only works with licensed operators and follows strict global compliance and due diligence standards.
Price: $12.82, Change: $-4.02, Percent Change: -23.87%