NEW YORK--(BUSINESS WIRE)--The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Western District of Kentucky on behalf of those who acquired Holley Inc. (“Holley” or the “Company”) (NYSE: HLLY) securities during the period from July 21, 2021 through February 6, 2023 (the “Class Period”). Investors have until January 5, 2024 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
On July 28, 2022, Holley announced disappointing preliminary financial results and slashed its full year 2022 outlook. On this news, the price of Holley shares declined by $4.68 per share, or approximately 36.94%, from $12.67 per share to close at $7.99 on July 29, 2022.
On November 14, 2022, Holley announced disappointing financial results for third quarter 2022. On this news, the price of Holley shares declined by $0.22 per share, or approximately 6.85%, from $3.21 per share to close at $2.99 on November 14, 2022.
On February 6, 2023, Holley announced that Chief Executive Officer and President Tom Tomlinson was retiring, effective immediately, and also resigning from Holley’s Board of Directors. The same day, Holley announced preliminary fourth quarter 2022 and full year 2022 financial results that fell below market estimates. In its financial results, the Company also announced adjusted EBITDA that Holley’s new Chief Financial Officer Jesse Weaver called “disappointing.” On this news, the price of Holley shares declined by $1.06 per share, or approximately 40%, from $3.42 per share to close at $2.36 on February 7, 2023.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) as a result of Holley’s extensive focus on its direct-to-consumer (“DTC”) channel, Holley’s critically important relationships with its resellers and distributors, whose business made up the vast majority of Holley’s revenue, were suffering significant damage; (ii) Holley used discounting and other similar efforts to grow its DTC channel, which undermined the pricing discipline Holley historically had with its resellers and distributors, and further damaged Holley’s relationship with its resellers and distributors; (iii) as a result of the Company’s strained relationships with its resellers and distributors, those resellers and distributors were decreasing their purchases of Holley products, returning products already purchased at significant levels that were far above historical norms, and increasing their purchases of competitors’ products; (iv) Holley’s growing DTC channel could not offset the negative financial impact of the Company’s increasingly strained relationships with its resellers and distributors and, as a result, Holley’s critical relationship with resellers and distributors was deteriorating; (v) Holley had failed to successfully integrate and capture synergies from its numerous acquisitions, which left Holley with inefficient operations, excess costs, and inventory management problems; and (vi) Holly benefited from COVID-related stimulus money that temporarily boosted its sales and performance, and despite this unsustainable, temporary boost, Defendants misled investors to believe the growth was sustainable and the result of persistent demand, and supportive of positive financial guidance.
If you purchased or otherwise acquired Holley securities, have information, or would like to learn more about this investigation, please contact Thomas W. Elrod of Kirby McInerney LLP by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: https://www.kmllp.com.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.