Scrutiny of Cardinal Infrastructure Group Inc. widened after Hagens Berman said it opened an investigation into potential federal securities law violations tied to the company’s disclosures about its operations and business prospects. The move follows Cardinal’s August 11, 2026 second-quarter results, which showed record revenue but sharply weaker profitability, including adjusted EPS of $0.26, down 51% year over year and well below the $0.47 analyst consensus. Adjusted gross profit margin fell to 15.9% from 21.3% a year earlier, while adjusted EBITDA margin dropped to 12.4% from 18.6%, prompting management to lower its full-year 2026 adjusted EBITDA margin target to 16% to 18% from prior guidance of greater than 20%. Cardinal attributed the deterioration to labor shortages, reliance on costly third-party equipment, high subcontractor costs and higher spending in certain markets as it worked through a rapidly expanding backlog. Hagens Berman said its review is examining whether Cardinal should have disclosed those cost pressures and equipment dependencies when it highlighted backlog growth, including an $866 million backlog as of June 30, and after completing a June 24 secondary offering of 4.6 million Class A shares at $73 each that raised more than $318 million in net proceeds. Cardinal shares fell more than 36% in a single trading session after the earnings release. Holzer & Holzer had also previously announced an investigation based on the same August 11 disclosures.