SAN FRANCISCO--(BUSINESS WIRE)--Hagens Berman Sobol Shapiro LLP, a national investor-rights law firm, is investigating whether Natus Medical Incorporated. (NASDAQ: BABY) issued false and misleading statements about its expected receipt of prepayments under a contract with the Venezuelan Government and the timing of certain insiders’ stock sales, potentially in violation of the securities laws.
If you have significant losses in your investments in Natus Medical Inc. or have knowledge relevant to the investigation, contact Hagens Berman Partner Reed Kathrein, who is leading the firm’s investigation by calling 510-725-3000, emailing BABY@hbsslaw.com or visiting https://www.hbsslaw.com/cases/BABY.
On October 15, 2015, Natus announced its entry into a supply agreement with the Venezuelan government to provide medical equipment, supplies and services over a three-year period. The Company stated “[p]repayments totaling approximately $69 million are expected by the first quarter of 2016” and “[i]f fully performed, the total sales under the agreement would aggregate $232.5 million.” Over the next 5 ½ months, Natus received no Venezuelan prepayments and twice reduced its revenue guidance shortly after its CEO and CFO sold significant amounts of their shares in the Company.
First, on January 11, 2016, and having received no Venezuelan prepayments, Natus reduced fourth quarter 2015 revenue guidance from $102 - $105 million to approximately $100 million. That day, Natus’ stock closed at $38.25 per share or over 11% lower than the previous closing price of $43.20 per share on January 8, 2016.
Second, on April 4, 2016, and having received no prepayments, Natus reduced its first quarter 2016 revenue guidance from $91.5 - $92.5 million. That day, Natus’ stock closed at $31.84 per share, or over 19% lower than the previous close on April 1 of $39.64 per share.
“Among other things, we’re concerned about the insider selling, especially in view of the Company’s stated expectation of receiving prepayments, its failure to receive any, its twice-reduced guidance and the effect on the stock price,” said Hagens Berman partner Reed Kathrein.
Whistleblowers: Persons with non-public information regarding Natus should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new SEC whistleblower 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 BABY@hbsslaw.com.
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