SAN DIEGO--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (http://www.rgrdlaw.com/cases/flooranddecor/) today announced that a class action has been commenced on behalf of purchasers of Floor & Decor (NYSE:FND) common stock during the period between May 23, 2018 and August 1, 2018, inclusive (the “Class Period”). This action was filed in the United States District Court for the Northern District of Georgia and is captioned Taylor v. Floor & Decor Holdings, Inc., et al.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Floor & Decor common stock during the Class Period to seek appointment as lead plaintiff. A lead plaintiff acts on behalf of all other class members in directing the litigation. The lead plaintiff can select a law firm of its choice. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at djr@rgrdlaw.com. You can view a copy of the complaint as filed at http://www.rgrdlaw.com/cases/flooranddecor/.
The complaint charges Floor & Decor, two of its executive officers and certain of the Company’s controlling shareholders with violations of the Securities Exchange Act of 1934. Floor & Decor describes itself as a high-growth differentiated multi-channel specialty retailer of hard surface flooring and related accessories, with warehouse-format stores across 21 states.
On May 3, 2018, the Company announced its financial results for the first quarter of fiscal 2018, reporting revenue and earnings results that beat expectations and increasing the Company’s financial projections for the remainder of fiscal 2018. On May 23, 2018, the Company filed a Registration Statement and Prospectus with the SEC for a secondary offering of 10 million shares of Floor & Decor common stock at $44.77 per share (the “May 24 Secondary Offering”), raising more than $400 million for the selling shareholders. The Registration Statement incorporated the Company’s historical financial performance and growth prospects and purported to warn investors that there were certain risks that, “if” they occurred, “could” cause the Company’s financial results to be adversely affected.
The complaint alleges that during the Class Period, defendants made false and misleading statements and/or failed to disclose adverse information regarding Floor & Decor’s business and prospects. Specifically, each of the statements in the Registration Statement filed with the SEC regarding the current financial condition of the Company was materially false and misleading because, prior to the May 24 Secondary Offering, defendants knew, but failed to disclose, that the Company had already begun to experience declining sales trends that would ultimately result in the reduction of its fiscal 2018 sales and adjusted earnings per share guidance, which had been increased as recently as May 2018. As a result of this adverse information being withheld from the market, the price of the Company’s stock was artificially inflated during the Class Period, allowing Company insiders to sell more than 10.3 million shares of Floor & Decor common stock, including the shares sold in the May 24 Secondary Offering, for proceeds of more than $466 million.
Then on August 2, 2018, before the market opened, Floor & Decor announced its financial results for the second quarter of 2018. The second quarter results were in sharp contrast to the assurances made on May 3, 2018 about the strength of the Company’s business and its continuing growth trajectory for the remainder of 2018. As a result of these disclosures and the significant reduction in the Company’s fiscal year 2018 sales and earnings per share guidance, Floor & Decor’s stock price declined more than 21%, from a close of $47.71 per share on August 1, 2018 to a close of $37.50 per share on August 3, 2018.
Plaintiff seeks to recover damages on behalf of all purchasers of Floor & Decor common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
