Glancy
Prongay & Murray LLP (“GPM”), a national investors rights law
firm, announces that a class action lawsuit has been filed on behalf of
investors that acquired A.O. Smith Corporation (“A.O. Smith” or the
“Company”) (NYSE: AOS)
securities between July 26, 2016 and May 16, 2019, inclusive
(the “Class Period”). A.O. Smith investors have until July 29, 2019 to
file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here
to participate.
If you wish to learn more about this action, or if you have any
questions concerning this announcement or your rights or interests with
respect to these matters, please contact Lesley Portnoy, Esquire, at
310-201-9150, Toll-Free at 888-773-9224, or by email to shareholders@glancylaw.com,
or visit our website at www.glancylaw.com.
On May 16, 2019, J Capital Research published a report raising questions
about A.O. Smith’s revenue from China as well as its access to $539
million—or about 84% of the Company’s total cash at year end
2018—sitting in China.
On this news, the Company’s share price fell sharply during intraday
trading, thereby injuring investors.
The complaint filed in this class action alleges that throughout the
Class Period, Defendants made materially false and/or misleading
statements, as well as failed to disclose material adverse facts about
the Company’s business, operations, and prospects. Specifically,
Defendants failed to disclose to investors: (1) that the Company had
undisclosed business connections and entanglements with UTP through
which it funneled up to 75% of its China product sales; (2) that the
Company had used UTP to engage in channel stuffing by artificially
inflating inventories purportedly sold through distributors that were
not based on consumer demand, thereby approximately doubling the normal
level of inventory at such distributors; (3) that the Company had used
its UTP relationship to artificially inflate the sales figures it
reported to investors by as much as 8% and to conceal worsening sales
trends that the Company was experiencing in China; (4) that the
Company’s sales growth had been primarily in lower margin products as
its higher priced products were being undercut by competition in
“second-tier” Chinese cities, causing the Company to experience
significant market pressures; (5) that the Company had increased its
cash reserves in China to over $530 million in furtherance of its
channel stuffing and sales manipulation scheme, encumbering the
Company’s ability to repatriate the cash for use for capital
expenditures; and (6) as a result, the Company’s public statements were
materially false and misleading at all relevant times.
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If you purchased shares of A.O. Smith during the Class Period you may
move the Court no later than July 29, 2019 to ask the
Court to appoint you as lead plaintiff. To be a member of the Class you
need not take any action at this time; you may retain counsel of your
choice or take no action and remain an absent member of the Class. If
you wish to learn more about this action, or if you have any questions
concerning this announcement or your rights or interests with respect to
these matters, please contact Lesley Portnoy, Esquire, of GPM, 1925
Century Park East, Suite 2100, Los Angeles, California 90067, at
310-201-9150, Toll-Free at 888-773-9224, by email to shareholders@glancylaw.com,
or visit our website at www.glancylaw.com.
If you inquire by email please include your mailing address, telephone
number and number of shares purchased.
This press release may be considered Attorney Advertising in some
jurisdictions under the applicable law and ethical rules.
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