Shareholder Alert: Robbins LLP Reminds Investors Mohawk Industries, Inc. (MHK) Sued for Misleading Shareholders
SAN DIEGO & CALHOUN, Ga.--(BUSINESS WIRE)--Feb 10, 2020--
Shareholder rights law firm Robbins LLP reminds investors that a purchaser of Mohawk Industries, Inc. (NYSE: MHK) filed a class action complaint for alleged violations of the Securities Exchange Act of 1934 between April 28, 2017 and July 25, 2019. Mohawk Industries designs, manufactures, sources, distributes, and markets flooring products for residential and commercial spaces worldwide.
If you suffered a loss as a result of Mohawk’s misconduct, click here.
Mohawk Industries, Inc. (MHK) Accused of Channel-Stuffing
According to the complaint, to address the mounting market demand of Luxury Vinyl Tile (“LVT”) flooring material, in June 2015, Mohawk acquired IVC Group, an LVT manufacturer, in a deal worth $1.2 billion. However, the market’s emphasis on LVT left Mohawk scrambling to bolster sales in its conventional flooring products, and as a result, Mohawk began channel-stuffing to conceal its dismal sales growth and financial performance. Beginning in April 2017, Mohawk touted its purported “growing demand” for its conventional flooring products and continued to highlight its sales growth throughout the relevant period, allowing its stock to trade at an artificially inflated price. Then, on July 25, 2019, after Mohawk had repeatedly reported financial results that missed analysts’ estimates and the Company’s guidance range, Mohawk reported sales in its Flooring NA segment that were down 7% and finally revealed that “lower demand” for certain conventional flooring products created excess inventory that impacted Mohawk’s sales and margins. On this news, Mohawk’s stock dropped $27.76, nearly 18%, to close at $128.84. The stock has yet to recover.
Mohawk Industries, Inc. (MHK) Shareholders Have Legal Options
Robbins LLP is a nationally recognized leader in shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. Click here to receive free alerts from Stock Watch when companies engage in wrongdoing.
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SOURCE: Robbins LLP
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PUB: 02/10/2020 12:33 PM/DISC: 02/10/2020 12:33 PM