SAN FRANCISCO, Nov. 22, 2019 (GLOBE NEWSWIRE) -- Hagens Berman urges Grubhub Inc. (NYSE: GRUB) investors who have suffered losses in excess of $100,000 to submit their losses now to learn if they qualify to recover compensable damages. A securities fraud class action was recently filed against the company and its senior executives.
Grubhub Inc. (GRUB) Securities Class Action:
The complaint alleges that Defendants misled investors about Grubhub’s business and prospects.
More specifically, according to the complaint, Defendants concealed, among other things: (1) customer orders were declining, despite massive investments the company made to spur demand for and use of its platform; (2) Grubhub’s new customer additions were generating significantly lower revenues compared to historic cohorts; (3) Grubhub’s vaunted business model under which it secured exclusive restaurant partnerships had failed, and the company resorted to using the same aggressive non-partnered sales tactics used by its competitors; (4) Grubhub was required to spend substantial additional capital in order to grow revenues and retain market share in the face of heightened competition and market saturation; and, (5) Grubhub was tracking tens of millions of dollars below its revenue and earnings guidance.
On Oct. 28, 2019, Defendants shocked investors when they announced disappointing 3Q 2019 financial results. Defendants blamed the results on a sequential fall of daily average grubs and lower value new customers. In addition, the company disclosed that its projected 2020 EBITDA was 70% below market expectations. Analysts characterized these revelations as “a shocker,” “a disaster,” “drastic,” “alarming,” “concerning,” and “troubling.”
This news drove the price of Grubhub shares down more than 40% on Oct. 29, 2019.
If you invested in Grubhub between July 30, 2019 and Oct. 28, 2019 and suffered significant losses (in excess of $100,000) you may qualify to be a lead plaintiff – one who selects and oversees the attorneys prosecuting the case. Contact Hagens Berman immediately to obtain additional information about this case or being a lead plaintiff.
“We are focused on investors’ losses and proving the Company misled the market about its failing business model,” said Hagens Berman partner Reed Kathrein.
If you purchased shares of Grubhub and suffered significant losses, click here to discuss your legal rights with Hagens Berman.
Whistleblowers: Persons with non-public information regarding Grubhub should consider their options to help in the investigation or take advantage of the SEC whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 510-725-3000 or email GRUB@hbsslaw.com.
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Reed Kathrein, 510-725-3000