The Law Offices of Frank R. Cruz Announces the Filing of a Securities Class Action on Behalf of Grubhub Inc. Investors (GRUB)
14 Gennaio 2020 - 10:56PM
Business Wire
The Law Offices of Frank R. Cruz announces that a class action
lawsuit has been filed on behalf of investors that acquired Grubhub
Inc. (“Grubhub” or the “Company”) (NYSE: GRUB) common stock between
July 30, 2019 and October 28, 2019, inclusive (the “Class
Period”). Grubhub investors have until January 21, 2020 to
file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to
participate.
On October 28, 2019, Grubhub announced disappointing financial
results for its third fiscal quarter of 2019, revealing that an
important demand metric, daily average grubs, had actually fallen
6% sequentially despite an increase in active diners. The Company
slashed 2019 earnings and revenue projections, and expected only
$100 million in EBITDA for 2020, more than 70% below market
expectations.
On this news, Grubhub share price fell $25.28, or over 43%, to
close at $33.11 per share on October 29, 2019, thereby injuring
investors.
The complaint filed in this class action alleges that throughout
the Class Period, Defendants made materially false and/or
misleading statements, as well as failed to disclose material
adverse facts about the Company’s business, operations, and
prospects. Specifically, Defendants failed to disclose to
investors: (1) that customer orders were actually declining,
despite the massive investments the Company had made to spur demand
for and use of its platform; (2) that Grubhub’s new customer
additions were generating significantly lower revenues as compared
to historic cohorts because these customers were more prone to
using competitor platforms; (3) that Grubhub’s vaunted business
model under which it secured exclusive restaurant partnerships had
failed, and Grubhub needed to engage in the same aggressive
non-partnered sales tactics embraced by its competitors to generate
significant revenue growth; (4) that Grubhub was required to spend
substantial additional capital in order to grow revenues and retain
market share in the face of heightened competitive dynamics and
market saturation, eviscerating the Company’s profitability; and
(5) that as a result, Grubhub’s public statements were materially
false and misleading at all relevant times.
Follow us for updates on Twitter: twitter.com/FRC_LAW.
If you purchased Grubhub securities during the Class Period, you
may move the Court no later than January 21, 2020 to ask the
Court to appoint you as lead plaintiff. To be a member of the Class
you need not take any action at this time; you may retain counsel
of your choice or take no action and remain an absent member of the
Class. If you purchased Grubhub securities, have information or
would like to learn more about these claims, or have any questions
concerning this announcement or your rights or interests with
respect to these matters, please contact Frank R. Cruz, of The Law
Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los
Angeles, California 90067 at 310-914-5007, by email to
info@frankcruzlaw.com, or visit our website at
www.frankcruzlaw.com. If you inquire by email please include your
mailing address, telephone number, and number of shares
purchased.
This press release may be considered Attorney Advertising in
some jurisdictions under the applicable law and ethical rules.
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version on businesswire.com: https://www.businesswire.com/news/home/20200114005855/en/
The Law Offices of Frank R. Cruz, Los Angeles Frank R. Cruz,
310-914-5007 fcruz@frankcruzlaw.com www.frankcruzlaw.com
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