Acuity Brands, Inc.
Acuity Accused of Overstating the Company’s Ability to Achieve Profitable Sales Growth
According to the complaint, on October 5, 2016, Acuity Brands, Inc. (NYSE: AYI) released the first of a series of disappointing financial and operational reports to investors. Despite the poor results, Acuity reiterated its targeted sales growth in the “mid-to-upper-single-digit range” and represented that management “remain[ed] bullish regarding the company’s prospects for continued profitable growth.” Then, on January 9, 2017, Acuity reported softening demand due to election jitters and decreased profitability because the company hired more employees than necessary for the volume of sales generated, but again reiterated that management “remain[ed] bullish regarding the company’s prospects for continued profitable growth.” On April 4, 2017, Acuity lowered growth expectations, admitting that the company continued to suffer from overstaffing issues and that demand softness could linger into the future. As news of Acuity’s troubles hit the market, Acuity’s stock fell nearly 32% to close at $173.93 per share on April 4, 2017. Acuity’s stock has yet to regain its pre-class period value when it regularly traded over $250.00.