Glancy Prongay & Murray LLP Reminds Investors of Looming Deadline in the Class Action Lawsuit Against Daktronics, Inc. (DAKT)
LOS ANGELES--(BUSINESS WIRE)--Dec 27, 2022--
Glancy Prongay & Murray LLP (“GPM”) reminds investors of the upcoming February 21, 2023 deadline to file a lead plaintiff motion in the class action filed on behalf of investors who purchased or otherwise acquired Daktronics, Inc. (“Daktronics” or the “Company”) (NASDAQ: DAKT ) securities between March 10, 2022 and December 6, 2022, inclusive (the “Class Period”).
If you suffered a loss on your Daktronics investments or would like to inquire about potentially pursuing claims to recover your loss under the federal securities laws, you can submit your contact information at www.glancylaw.com/cases/daktronics-inc/. You can also contact Charles H. Linehan, of GPM at 310-201-9150, Toll-Free at 888-773-9224, or via email at email@example.com to learn more about your rights.
On August 31, 2022, Daktronics issued a press release announcing its first quarter 2023 results. Therein, the company reported that it experienced “multiple material supply chain disruptions, labor shortages, and a shutdown of our facilities in Shanghai, China for a significant portion of the quarter.” The Company also reported that gross profit as a percentage of net sales was 15%, which was lower compared to 22% a year earlier. Operating expenses were $31.3 million, compared to $26.5 million a year earlier. And operating margin for the first quarter of fiscal 2023 was negative 3.2%, compared to positive 3.9% for the first quarter of fiscal 2022.
On this news, Daktronics’ share price fell $0.91, or 22.1% to close at $3.20 per share on August 31, 2022, thereby injuring investors.
Then, on December 6, 2022, after the market closed, Daktronics filed a Form 12b-25 with the SEC stating that it would be unable to timely file its Quarterly Report on Form 10-Q for the period ended October 29, 2022, and that there is “substantial doubt” about the Company’s ability to continue as a going concern. Daktronics also disclosed that it recorded a valuation allowance of approximately $13.0 million for deferred tax assets, which “created a covenant violation under our line of credit agreement.” As a result, the Company “also expects to conclude that its disclosure controls and procedures and internal control over financial reporting were not effective as a result of material weaknesses.”
On this news, Daktronics’ share price fell $1.30, or 39.2%, to close at $2.02 per share on December 7, 2022, 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 the Company was experiencing challenges that increased costs, including supply chain disruptions, that impacted Daktronics’ ability to fund inventory levels and operations; (2) that, as a result, it was probable that some portion of the Company’s deferred tax assets would not be realized; (3) that as a result, Daktronics was reasonably likely to record a material valuation allowance to its deferred tax assets; (4) that there were material weaknesses in the Company’s internal controls over financial reporting related to income taxes; (5) that the foregoing presented liquidity concerns and there was substantial doubt as to the Company’s ability to continue as a going concern; (6) as a result, Defendants’ statements about its business, operations, and prospects were materially false and misleading and/or lacked reasonable basis at all relevant times.
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If you purchased or otherwise acquired Daktronics securities during the Class Period, you may move the Court no later than February 21, 2023 to request appointment as lead plaintiff in this putative class action lawsuit. To be a member of the class action 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 action. If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to the pending class action lawsuit, please contact Charles Linehan, Esquire, of GPM, 1925 Century Park East, Suite 2100, Los Angeles, California 90067 at 310-201-9150, Toll-Free at 888-773-9224, by email to firstname.lastname@example.org, or visit our website at www.glancylaw.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.
View source version on businesswire.com:https://www.businesswire.com/news/home/20221227005016/en/
CONTACT: Glancy Prongay & Murray LLP, Los Angeles
Charles Linehan, 310-201-9150 or 888-773-9224
KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA
INDUSTRY KEYWORD: CLASS ACTION LAWSUIT PROFESSIONAL SERVICES LEGAL
SOURCE: Glancy Prongay & Murray LLP
Copyright Business Wire 2022.
PUB: 12/27/2022 11:00 AM/DISC: 12/27/2022 11:02 AM