NEW YORK, April 22, 2020 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that class actions have been commenced on behalf of stockholders of eHealth, Inc. (NASDAQ: EHTH), ServiceMaster Global Holdings, Inc. (NYSE: SERV), and iQIYI, Inc. (NASDAQ: IQ). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.
eHealth, Inc. (NASDAQ: EHTH)
Class Period: March 19, 2018 to April 7, 2020
Lead Plaintiff Deadline: June 8, 2020
On April 8, 2020, analyst Muddy Waters Research issued a report stating that the Company uses “highly aggressive accounting” to mask “a significantly unprofitable business.” Muddy Waters wrote that “[a]fter ASC 606 went into effect,” eHealth’s “member churn . . . skyrocketed,” and concluded “that EHTH is pursuing low quality, lossmaking growth while its LTVs are based on lower churn, pre-growth cohorts.” Further, Muddy Waters charged eHealth’s management with “running a massive stock promotion.”
On this news, eHealth’s stock price fell approximately 12%, to close at $103.20 per share.
The complaint, filed on April 8, 2020, alleges that eHealth misrepresented and/or failed to disclose to investors: (1) its highly aggressive accounting and modeling assumptions; (2) its skyrocketing rate of member churn, resulting from eHealth’s pursuit of low quality, lossmaking growth; (3) its reliance on direct response television advertising, which attracts an unprofitable, high churn enrollee; and (4) as a result of the foregoing, defendants’ public statements were materially false and misleading at all relevant times.
For more information on the eHealth class actin go to: https://bespc.com/EHTH
ServiceMaster Global Holdings, Inc. (NYSE: SERV)
Class Period: February 26, 2019 to November 4, 2019
Lead Plaintiff Deadline: June 9, 2020
On October 22, 2019, ServiceMaster announced disappointing preliminary financial results for the third quarter of 2019. The company stated that it missed revenue and earnings estimates and issued downward adjusted EBITDA guidance. The press release attributed the disappointing results to “termite damage claims arising primarily from Formosan termite activity,” primarily in Mobile, Alabama. The Company further stated that this had been a known issue, having taken mitigating measures “starting in 2018.” Finally, the Company announced the sudden departure of Matthew J. Stevenson in his role as President of Terminix Residential.
On this news the price of ServiceMaster common stock fell $11.44 per share or 20%, closing at $44.70 per share on October 22, 2019.
Then, on November 5, 2019, ServiceMaster released its third quarter 2019 financial results. In this press release discussing the “challenging quarter,” the Company revealed that it had been impacted by certain “legacy risks,” including “termite damage claims.” That same day, defendants held an earnings call with analysts and investors to discuss ServiceMaster’s third quarter 2019 financial results. On the call, defendants informed the market that the increase in termite litigation—which had occurred “[i]n the past few years”—had impacted termite revenue and these issues would continue throughout 2020.
On this news, the price of ServiceMaster shares fell $1.42 per share, or 3.5%, to close at $39.15 per share on November 5, 2019. As the market continued to digest the disappointing news, ServiceMaster shares further declined by $3.41, or 9%, to close at $35.74 per share on November 6, 2019.
All told, following the November 5, 2019 disclosure, ServiceMaster stock suffered a total decline of $4.83 per share from its November 4, 2019 closing price.
The complaint, filed on April 10, 2020, alleges that during the Class Period defendants repeatedly assured the market that ServiceMaster was successfully executing upon initiatives to improve the performance in the Terminix segment. In addition, defendants stated that Terminix would reach a positive “inflection point” and was “definitely the driver” for positive trends expected in the second half of 2019. Unbeknownst to investors, however, in the past several years the Terminix segment had experienced an adverse trend of costly termite litigation, primarily related to Formosan termite activity. This negative trend, which would ultimately impact ServiceMaster’s current and future financial results, was known to defendants throughout the Class Period, as by their own later admission they had been taking mitigating measures since 2018.
For more information on the ServiceMaster class action go to: https://bespc.com/SERV
iQIYI, Inc. (NASDAQ: IQ)
Class Period: March 29, 2018 to April 7, 2020
Lead Plaintiff Deadline: June 15, 2020
On April 7, 2020, Wolfpack Research released a report detailing, among other things, how iQIYI had misled investors and failed to disclose pertinent information generally and in its March 2018 initial public offering Registration Statement, including: (i) iQIYI overstating its user numbers; (ii) iQIYI inflating its revenues; (iii) iQIYI inflating expenses and prices of assets to conceal its revenue inflation; and (iv) iQIYI issuing misleading financial reporting creating the appearance of a cash generative company.
On this news, iQIYI’s share price fell $0.99 per share over the rest of the trading day and the next full trading day, or 5.6%, to close at $16.51 per share on April 8, 2020.
The complaint, filed on April 16, 2020, alleges that throughout the Class Period defendants made false and/or misleading statements and/or failed to disclose that: (1) iQIYI inflated its revenue figures; (2) iQIYI inflated its user numbers; (3) iQIYI inflated its expenses to cover up other fraud; and (4) as a result, defendants’ statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times. According to the suit, these true details were disclosed by a market research firm.
For more information on the iQIYI class action go to: https://bespc.com/IQ
About Bragar Eagel & Squire, P.C.:
Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.
Contact Information:
Bragar Eagel & Squire, P.C.
Melissa Fortunato, Esq.
Marion Passmore, Esq.
(212) 355-4648
investigations@bespc.com
www.bespc.com
