HLLY - Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Holley Inc. F/K/A Empower Ltd. (HLLY)
NEW YORK, Nov. 07, 2023 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Western District of Kentucky on behalf of all persons or entities who purchased or otherwise acquired Holley Inc., F/K/A Empower Ltd, (“Holley” or the “Company”) (NYSE: HLLY) securities between July 21, 2021 and February 6, 2023, inclusive (the “Class Period”). The lawsuit seeks to recover damages for the Company’s investors under the federal securities laws.
The Complaint in the Holley class action lawsuit alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (i) as a result of Holley’s alleged 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 allegedly 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 Holley’s alleged 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 alleged growing DTC channel could not offset the negative financial impact of Holley’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 allegedly 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 allegedly 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.
The Complaint alleges that On July 28, 2022, Holley announced preliminary financial results that missed expectations and slashed its full year 2022 outlook. The Complaint alleges that on this news. the price of Holley stock fell more than 47% over two trading sessions.
The Complaint further alleges that on November 14, 2022, Holley announced additional disappointing financial results for third quarter 2022. The Complaint also alleges that on this news, the price of Holley stock fell nearly 7%.
The Complaint further alleges that thereafter, 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 and that Holley’s fourth quarter 2022 sales fell short of market estimates as well as adjusted EBITDA that new Holley Chief Financial Officer Jesse Weaver called “disappointing.” The Complaint alleges that on this news, the price of Holley stock fell more than 37% over two trading sessions.
Investors who purchased or otherwise acquired shares of Holley should contact the Firm prior to the January 5, 2024 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com .
Please visit our website at http://www.gme-law.com for more information about the firm.