SAN DIEGO & MALVERN, Pa.--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a class action has been filed on behalf of all purchasers of Rekor Systems, Inc. (NASDAQ: REKR) securities between April 19, 2019 and May 25, 2021, seeking to recover damages by defendants pursuant to the Securities Exchange Act of 1934. Rekor, through its subsidiaries, provides automatic license plate recognition ("ALPR") technology based on artificial intelligence in the U.S. and internationally. Rekor was formerly known as Novume Solutions, Inc. (NASDAQ: NVMM) before changing its name on April 30, 2019.
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Rekor Systems, Inc. (REKR) Made Misstatements Regarding its Business Prospects
According to the complaint, during the class period, Rekor touted the lucrative prospects of its uninsured vehicle enforcement diversion ("UVED") partnership with the State of Oklahoma, under which the Company receives compensation and commission fees in exchange for using ALPR technology to scan vehicle license plates and compare them against a database to identify vehicles without auto insurance. The Company also touted the future business prospects and applications of its ALPR technology.
On May 10, 2021, news sources reported market speculation that the bill authorizing the establishment of a state UVED program in Texas was dead. In an earnings call that same day, defendants indicated that Rekor might not secure the UVED agreement with Texas. On this news, Rekor's stock price declined $7.65 over two days, or 40.45%, to close at $11.26 per share on May 11, 2021.
On May 26, 2021, Western Edge published a report entitled "Rekor Systems: Lackluster Growth Runway And Exaggerated Insurance Scheme Raise Substantial Downside Risk," noting that the competition was "miles ahead" of Rekor in terms of development and market establishment and that Company's "realized results suggest management's potential revenue guidance could be overstated by up to 80%." The report also noted that state and local privacy laws and related public concerns would impede municipalities from implementing legislation allowing Rekor's services. That same day, Mariner Research Group published a report entitled "REKR – Government documents do not support investor expectations" highlighting "government documentation which shows that REKR's revenue opportunities are likely a fraction of what investors expect[.]" Following publication of these reports, Rekor's stock fell an additional 3.93% per share on May 26, 2021.
If you purchased shares of Rekor Systems, Inc. (REKR) between April 19, 2019 and May 25, 2021, you have until August 30, 2021, to ask the court to appoint you lead plaintiff for the class.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
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