Although they have recovered slightly now, the shares of Estia Health Ltd (ASX: EHE) were down by as much as 12.3% in early trade today after they emerged from their trading halt.

The company’s share price is now down just 6.4% at $3.09.

Yesterday the embattled aged care operator placed its shares in a trading halt whilst it prepared an update on its first quarter trading. With the market fearing the worst, the shares of its rivals Regis Healthcare Ltd (ASX: REG) and Japara Healthcare Ltd (ASX: JHC) came under heavy selling pressure.

It would appear as though the market was right to be concerned about what Estia Health might announce. This morning the company advised that it is downgrading its full year underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) guidance.

Just over a month ago the company advised that it expected FY 2017 underlying EBITDA to come in at least 13% higher year on year at almost $105 million. But following a review it now expects underlying EBITDA for FY 2017 will be between $86 million to $90 million.

According to the release, the principal contributors to the shocking reduction in its guidance are the result of a lower projected occupancy growth rate and a reappraisal of the company’s anticipated non-labour operating expenses.

I find it incredibly worrying for the company to reduce its full-year EBITDA guidance so significantly in such a short space of time. As a result, I am not at all surprised to see investors head for the exits in their droves this morning.

It is worth noting though that since the previous guidance was provided both its founder Peter Arvanitis and its CEO Paul Gregersen have left the company. So it would be unfair to place the blame on the current management team, who were evidently left with a huge mess to clean up.

Whilst this could potentially be a sign that the worst is now over, I personally would suggest investors stay clear of Estia Health no matter how cheap it appears.

Instead of risking your money in Estia Health I would highly recommend investments in these rapidly growing shares. Each has the potential to bolt higher in the months ahead if you ask me.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.