NEW YORK, Aug. 22, 2019 (GLOBE NEWSWIRE) -- Labaton Sucharow LLP (“Labaton Sucharow”) announces that on August 22, 2019, it filed a securities class action lawsuit on behalf of its client Building Trades Pension Fund of Western Pennsylvania against Textron Inc. (“Textron” or the “Company”) (NYSE: TXT), and certain of its senior executives (collectively, “Defendants”). The action, which is captioned Bldg. Trades Pension Fund of Western Pennsylvania v. Textron Inc., No. 19-cv-07881 (S.D.N.Y.), asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and U.S. Securities and Exchange Commission Rule 10b-5 promulgated thereunder, on behalf of all persons or entities who purchased or otherwise acquired Textron common stock between January 31, 2018 and October 17, 2018, inclusive (the “Class Period”).
Textron is a global manufacturer and distributor of small aircrafts and recreational vehicles. 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.
Notwithstanding these positive representations 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.
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 percent, to close at $57.49 on October 18, 2018, erasing $1.8 billion from its market capitalization.
If you purchased or acquired Textron common stock during the Class Period, you are a member of the “Class” and may be able to seek appointment as Lead Plaintiff. Lead Plaintiff motion papers must be filed with the U.S. District Court for the Southern District of New York no later than October 21, 2019. The Lead Plaintiff is a court-appointed representative for absent members of the Class. You do not need to seek appointment as Lead Plaintiff to share in any Class recovery in this action. If you are a Class member and there is a recovery for the Class, you can share in that recovery as an absent Class member. You may retain counsel of your choice to represent you in this action.
If you would like to consider serving as Lead Plaintiff or have any questions about this lawsuit, you may contact Francis P. McConville, Esq. of Labaton Sucharow, at (800) 321-0476, or via email at fmcconville@labaton.com.
You can view a copy of the complaint online here.
Building Trades Pension Fund of Western Pennsylvania is represented by Labaton Sucharow, which represents many of the largest pension funds in the United States and internationally with combined assets under management of more than $2 trillion. Labaton Sucharow’s litigation reputation is built on its half-century of securities litigation experience, more than 60 full-time attorneys, and in-house team of investigators, financial analysts, and forensic accountants. Labaton Sucharow has been recognized for its excellence by the courts and peers, and it is consistently ranked in leading industry publications. Offices are located in New York, NY, Wilmington, DE, and Washington, D.C. More information about Labaton Sucharow is available at www.labaton.com.
Source: Labaton Sucharow LLP