Attention investors who purchased shares of Grubhub Inc. between July 30, 2019 and October 28, 2019:
Rigrodsky & Long is investigating claims brought in a securities fraud class action complaint against Grubhub Inc. ("Grubhub") concerning whether Grubhub and certain of the Company's directors and/or officers made materially false and misleading statements and failed to disclose materially adverse facts during the period July 30, 2019 and October 28, 2019, inclusive (the "Class Period"), concerning Grubhub's business, operations and prospects. These misrepresentations and omissions artificially inflated the price of Grubhub's stock throughout the Class Period.
Rigrodsky & Long, P.A. announces that a complaint has been filed in the United States District Court for the Northern District of Illinois on behalf of all persons or entities that purchased the common stock of Grubhub Inc. (“Grubhub” or the “Company”) (NYSE: GRUB) between July 30, 2019 and October 28, 2019, inclusive (the “Class Period”), alleging violations of the Securities Exchange Act of 1934 against the Company and certain of its officers (the “Complaint”).
If you purchased shares of Grubhub during the Class Period, or purchased shares prior to the Class Period and still hold Grubhub, and wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Seth D. Rigrodsky or Timothy J. MacFall at Rigrodsky & Long, P.A., 300 Delaware Avenue, Suite 1220, Wilmington, DE 19801, by telephone at (888) 969-4242, by e-mail at firstname.lastname@example.org, or at http://rigrodskylong.com/contact-us/.
The Complaint alleges that throughout the Class Period, defendants made materially false and misleading statements, and omitted materially adverse facts, about the Company’s business, operations and prospects. Specifically, the Complaint alleges that the defendants concealed from the investing public that: (i) customer orders were actually declining, despite the massive investments the Company had made to spur demand for and use of its platform; (ii) Grubhub’s new customer additions were generating significantly lower revenues as compared to historic cohorts because these customers were more prone to using competitor platforms; (iii) Grubhub’s vaunted business model under which it secured exclusive restaurant partnerships had failed, and Grubhub needed to engage in the same aggressive non-partnered sales tactics embraced by its competitors to generate significant revenue growth; (iv) Grubhub was required to spend substantial additional capital in order to grow revenues and retain market share in the face of heightened competitive dynamics and market saturation, eviscerating the Company’s profitability; and (v) Grubhub was tracking tens of millions of dollars below its revenue and earnings guidance and such guidance lacked any reasonable basis.. As a result of defendants’ alleged false and misleading statements, the Company’s stock traded at artificially inflated prices during the Class Period.
According to the Complaint, on October 28, 2019, Grubhub announced deeply disappointing financial results for its third fiscal quarter of 2019. The Company revealed that an important Company demand metric, daily average grubs, had actually fallen 6% sequentially despite an increase in active diners and the Company’s highly touted demand initiatives. Defendants also slashed Grubhub’s 2019 earnings and revenue projections and stated that the Company would achieve only $100 million in EBITDA for 2020, more than 70% below market expectations.
On this news, shares of Grubhub fell over 43%, closing at $33.11 per share on October 29, 2019, on heavy trading volume.
If you wish to serve as lead plaintiff, you must move the Court no later than January 20, 2020. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Any member of the proposed class may move the court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
Rigrodsky & Long, P.A., with offices in Delaware, New York, and California, has recovered hundreds of millions of dollars on behalf of investors and achieved substantial corporate governance reforms in numerous cases nationwide, including federal securities fraud actions, shareholder class actions, and shareholder derivative actions.
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