The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of those who acquired Daktronics, Inc. (“Daktronics” or the “Company”) (NASDAQ: DAKT) securities during the period from March 10, 2022 through December 6, 2022 (the “Class Period”). Investors have until February 21, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Daktronics supplies electronic scoreboards, computer programmable display systems, and large video displays for sport, business, and government applications.
On August 31, 2022, the Company issued a press release announcing its fiscal first quarter 2023 results, which included an 18% increase in operating expenses compared to Q1’22. The Company noted that it “experienced multiple material supply chain disruptions, labor shortages, and a shutdown of our facilities in Shanghai, China for a significant portion of the quarter.” On this news, Daktronics’ stock price fell by $0.91 per share, or approximately 22.10%, from $4.11 per share to $3.20 on August 31, 2022.
On December 6, 2022, the Company filed a Form 12b-25 with the SEC stating that it would be unable to timely file its Quarterly Report on Form 10-Q for the period ended October 29, 2022, and that there is “substantial doubt” about the Company’s ability to continue as a going concern. Daktronics also disclosed that it “also expects to conclude that its disclosure controls and procedures and internal control over financial reporting were not effective as a result of material weaknesses.” On this news, Daktronics’ stock price fell by $1.30 per share, or approximately 39.20%, from $3.32 per share to close at $2.02 on December 7, 2022.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose: (1) that the Company was experiencing challenges that increased costs, including supply chain disruptions, that impacted Daktronics’ ability to fund inventory levels and operations; (2) that, as a result, it was probable that some portion of the Company’s deferred tax assets would not be realized; (3) that as a result, Daktronics was reasonably likely to record a material valuation allowance to its deferred tax assets; (4) that there were material weaknesses in the Company’s internal controls over financial reporting related to income taxes; and (5) that the foregoing presented liquidity concerns and there was substantial doubt as to the Company’s ability to continue as a going concern.
If you purchased or otherwise acquired Daktronics securities, have information, or would like to learn more about this investigation, please contact Thomas W. Elrod of Kirby McInerney LLP by email at firstname.lastname@example.org, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: http://www.kmllp.com.
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Kirby McInerney LLP
Thomas W. Elrod, Esq.