To join this class action, please complete the following Investor Certification.
Oklahoma City, OK (August 24, 2019) – On August 22, 2019, a securities class action lawsuit was filed in the United States District Court for the Southern District of New York against Textron, Inc. (NYSE: TXT). The complaint alleges violations of federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, including allegations of issuing a series of material or false misrepresentations to the market which had the effect of artificially inflating the market price during the Class Period, which is January 31, 2018 through October 17, 2018. More specifically, the complaint alleges that despite these positive depictions to the market, defendants failed to disclose that: (1) end-market sales of Arctic Cat products were slowing, resulting in a massive glut of old Arctic Cat inventory on dealers’ floors; (2) in order to clear out this old inventory, the Company provided significant price discounts, which negatively impacted Textron’s earnings; (3) as a result, Textron’s positive statements about Arctic Cat’s business, operations, and prospects were false and misleading.
On March 6, 2017, Textron expanded its recreational vehicle business through its $316 million acquisition of Arctic Cat Inc. (“Arctic Cat”). Upon the completion of this transaction, Arctic Cat became an indirect wholly-owned subsidiary of Textron. Arctic Cat designs and manufactures a variety of recreational vehicles, including all-terrain vehicles and snowmobiles. Arctic Cat revenues are generated through sales to independent dealers. Throughout the Class Period, Textron repeatedly touted Arctic Cat as an important growth business for the Company, reassuring investors about dealer demand, end-market sales and earnings prospects for its Arctic Cat products.
The truth about Arctic Cat’s inventory problems was revealed on October 18, 2018, when Textron reported weak third quarter 2018 earnings and cut its full-year 2018 forecast. The Company blamed the shortfall on heavy discounts issued by Textron to clear out old Arctic Cat inventory. Analysts immediately lowered their price targets on Textron stock citing the inventory concerns at Arctic Cat. On this news, Textron’s stock fell $7.29 or 11.25$, to close at $57.49 on October 18, 2018, erasing $1.8 billion from its market capitalization.
Plaintiff seeks to recover damages on behalf of all Textron, Inc. shareholders who purchased common stock during the Class Period and are therefore a member of the Class as described above. You may move the Court no later than Monday, October 21, 2019 to serve as a lead plaintiff for the entire Class. However, in order to do so, you must meet certain legal requirements pursuant to the Private Securities Litigation Reform Act of 1995.
If you wish to discuss this action, obtain further information and participate in this or any other securities litigation, or should you have any questions or concerns regarding this notice or preservation of your rights, please contact: Robin Hester at firstname.lastname@example.org