SAN DIEGO & CHARLOTTE, N.C.--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that a class action complaint was filed against Babcock & Wilcox Enterprises (NYSE: BW) ("B&W") in the U.S. District Court for the Western District of North Carolina. The complaint is brought on behalf of all purchasers of B&W securities between July 1, 2015 and February 28, 2017, for alleged violations of the Securities Exchange Act of 1934 by B&W's officers and directors. B&W provides energy and environmental technologies and services for the power and industrial markets worldwide. The company operates in three segments: Power, Renewable, and Industrial.
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Babcock & Wilcox Accused of Downplaying Problems in Its Renewable Segment
According to the complaint, B&W made a series of public statements touting the company's strong financial results, stating that all three business segments performed at or above target with a significant increase in revenues in Global Power. The company subsequently predicted strong financial performance in the coming months and raised its guidance for adjusted earnings per share. However, the complaint alleges that throughout the class period, B&W was experiencing significant problems in its Renewable segment. On June 28, 2016, B&W officials announced a restructuring of its traditional power business and revealed problems with a project in the company's European renewable business. B&W further announced that it was undertaking cost-savings measures and was eliminating over 200 positions in North America in response to the decline in coal utilization in the U.S. On this news, B&W's stock declined by 21% to close at $14.92 per share on June 28, 2016.
Then, on February 28, 2017, B&W announced that it missed earnings expectations by a wide margin, losing $71.6 million in the fourth quarter on revenue totaling $380 million. Notably, B&W's fourth quarter 2016 results were significantly below its fourth quarter 2015 earnings. B&W officials cited engineering, productivity, and scheduling issues in its Renewable segment, including that B&W would limit bidding on new Renewable projects that involved B&W's European resources for at least the first six months of 2017. On this news, B&W's stock dropped by 37% to close at $10.33 per share on March 1, 2017.
Babcock & Wilcox 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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