Shareholder Alert: Bernstein Litowitz Berger & Grossmann LLP Announces the Filing of Securities Class Action Lawsuit Against Five Below, Inc.
2024年9月17日 - 9:35AM
ビジネスワイヤ(英語)
Today, prominent investor rights law firm Bernstein Litowitz
Berger & Grossmann LLP (“BLB&G”) filed a class action
lawsuit in the U.S. District Court for the Eastern District of
Pennsylvania alleging violations of the federal securities laws by
Five Below, Inc. (“Five Below” or the “Company”) and certain of the
Company’s current and former executives (collectively,
“Defendants”). The action is brought on behalf of all investors who
purchased or otherwise acquired Five Below common stock between
December 1, 2022, and July 16, 2024, inclusive (the “Class
Period”). This case is related to a previously filed securities
class action pending against Five Below captioned Himes v. Five
Below, Inc., No. 24-cv-3638 (E.D. Pa.), which asserts a shorter
class period of March 20, 2024 through July 16, 2024.
BLB&G filed this action on behalf of its client, City of
Orlando Police Officers’ Pension Fund, and the case is captioned
City of Orlando Police Officers’ Pension Fund v. Five Below, Inc.,
No. 24-cv-4905 (E.D. Pa.). The complaint is based on an extensive
investigation and a careful evaluation of the merits of this case.
A copy of the complaint is available on BLB&G’s website by
clicking here.
Five Below’s Alleged
Fraud
Five Below is an “extreme value” retailer offering popular or
“trend-right” merchandise targeted at the “tween” and teen
demographic, with most of its products priced at or below $5. The
Company’s business depends on identifying and sourcing trend-right
products at low costs and then quickly selling them to capitalize
on existing trends before those trends fade and new trends
emerge.
The complaint alleges that, throughout the Class Period,
Defendants made numerous materially false and misleading statements
and omissions concerning Five Below’s ability to identify and
capitalize on trending products and the Company’s overall growth
plan. Specifically, Defendants repeatedly attributed Five Below’s
disappointing financial results to elevated levels of “shrink”—an
increase in inventory that is lost, stolen, or otherwise
unaccounted for—and other macroeconomic factors, while assuring
investors that the Company’s growth and sales remained intact. As a
result of these misrepresentations, Five Below common stock traded
at artificially inflated prices throughout the Class Period.
In reality, Defendants knew that Five Below was struggling to
identify and capitalize on trending products, and that the
Company’s growth plan was stalling. The truth began to emerge on
March 20, 2024, when the Company reported disappointing financial
results for the fourth quarter of 2023, which missed analysts’
consensus earnings-per-share target of $3.78 per share by $0.13 per
share, or approximately 3.5%. These disclosures caused the price of
Five Below stock to decline by $32.18 per share, or over 15%.
However, Defendants continued to downplay broader problems with the
Company’s business and blamed the poor results entirely on greater
than expected levels of shrink.
The truth was further revealed on June 5, 2024, when Five Below
released its first quarter 2024 financial results and disclosed a
nearly 15% year-over-year decline in operating income, and made
what analysts described as “deep cuts” to its sales guidance for
the remainder of the year after first quarter sales “fell short.”
As a result of these disclosures, the price of Five Below stock
declined by an additional $14.07 per share, or approximately 11%.
Despite these additional disclosures, Defendants continued to
assure investors that the Company was executing effectively on its
business strategy.
Then, on July 16, 2024, Five Below announced the sudden
departure of its Chief Executive Officer, Joel Anderson, and
further reduced its net sales and earnings guidance, which had
already been severely cut just weeks prior. These disclosures
caused the price of Five Below stock to decline by another $25.57
per share, or 25%.
The filing of this action does not alter the previously
established deadline to seek appointment as Lead Plaintiff.
Pursuant to the August 1, 2024 notice published in connection with
the Himes action, under the Private Securities Litigation Reform
Act of 1995, investors who purchased or otherwise acquired Five
Below securities during the Class Period may, no later than
September 30, 2024, seek to be appointed as Lead Plaintiff for the
Class. Any member of the proposed Class may seek to serve as Lead
Plaintiff through counsel of their choice, or may choose to do
nothing and remain a member of the proposed Class.
If you wish to discuss this action or have any questions
concerning this notice or your rights or interests, please contact
Scott R. Foglietta of BLB&G at 212-554-1903, or via e-mail at
scott.foglietta@blbglaw.com.
About BLB&G
BLB&G is widely recognized worldwide as a leading law firm
advising institutional investors on issues related to corporate
governance, shareholder rights, and securities litigation. Since
its founding in 1983, BLB&G has built an international
reputation for excellence and integrity and pioneered the use of
the litigation process to achieve precedent-setting governance
reforms. Unique among its peers, BLB&G has obtained several of
the largest and most significant securities recoveries in history,
recovering over $40 billion on behalf of defrauded investors. More
information about the firm can be found online at
www.blbglaw.com.
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Scott R. Foglietta Bernstein Litowitz Berger & Grossmann LLP
1251 Avenue of the Americas, 44th Floor New York, New York 10020
(212) 554-1903 scott.foglietta@blbglaw.com