SAN DIEGO & FARMINGTON, Utah--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that a class action complaint was filed against Vista Outdoor Inc. (NYSE: VSTO) in the U.S. District Court for the District of Utah. The complaint is brought on behalf of all purchasers of Vista Outdoor securities between August 11, 2016 and January 13, 2017, for alleged violations of the Securities Exchange Act of 1934 by Vista Outdoor's officers and directors. Vista Outdoor designs, manufactures, and markets consumer products for the outdoor sports and recreation markets worldwide.
View this information on the law firm's Shareholder Rights Blog:
Vista Outdoor Accused of Deceiving Investors About Its True Financial Condition
According to the complaint, Vista Outdoor submitted a series of filings with the U.S. Securities and Exchange Commission in which the company touted its successful growth strategy and emphasized that sales and gross profit had increased. In addition, Vista Outdoor predicted an optimistic financial outlook, anticipating "an improved retail landscape and a return to spending on hunting and shooting accessories to complement the growing firearms installed base." However, the complaint alleges that Vista Outdoor officials failed to disclose that: (1) the company was experiencing an acceleration in both the softening of the retail environment and its own promotional activity; (2) as a result, its financials were suffering; (3) it would have to begin the impairment assessment for its Outdoor Products segment earlier than expected; and (4) as a result, it would have to recognize a very large impairment charge.
On January 11, 2017, Vista Outdoor issued a press release disclosing that it expected to record a material, non-cash intangible asset impairment charge of $400-450 million in its Hunting and Shooting Accessories reporting unit in the third quarter of fiscal year 2017. Vista Outdoor further revealed that the softening retail environment and increased promotional activity had required the company to begin the impairment assessment for that segment's reporting units earlier than it typically would. In addition, Vista Outdoor stated that it had experienced revenue and gross margin declines attributable to a challenging retail environment and a shift in the consumers' share of wallet to platforms outside the company's firearms offerings. On this news, Vista Outdoor's stock fell $8.21 per share, or nearly 22%, to close at $29.58 per share on January 12, 2017. Following news that the company's President of the Outdoor Products segment was being replaced, Vista Outdoor's stock fell further to close at $28.70 per share on January 13, 2017.
Vista Outdoor Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, DDonahue@robbinsarroyo.com, or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.
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