Kessler Topaz Meltzer & Check, LLP - SPT Investor Alert: A Securities Fraud Class Action Lawsuit Has Been Filed Against Sprout Social, Inc. (SPT)
RADNOR, Pa., July 06, 2024 (GLOBE NEWSWIRE) -- The law firm of Kessler Topaz Meltzer & Check, LLP (www.ktmc.com) informs investors that securities class action lawsuits have been filed in the United States District Court for the Northern District of Illinois against Sprout Social, Inc. (“Sprout Social”) (NASDAQ: SPT). The actions charge Sprout Social with violations of the federal securities laws, including omissions and fraudulent misrepresentations relating to the company’s business, operations, and prospects. As a result of Sprout Social’s materially misleading statements and omissions to the public, Sprout Social’s investors have suffered significant losses. The lead plaintiff deadline is July 12, 2024.
If you purchased or acquired Sprout Social securities between November 2, 2023 and May 2, 2024, and suffered losses, you may CLICK HERE or go to: https://www.ktmc.com/new-cases/sprout-social-inc?utm_source=PR&utm_medium=link&utm_campaign=spt&mktm=r
You can also contact attorney Jonathan Naji, Esq. of Kessler Topaz by calling (484) 270-1453 or by email at info@ktmc.com.
DEFENDANTS’ ALLEGED MISCONDUCT
On November 2, 2021, Sprout Social issued a press release announcing financial results for the third quarter of 2021, highlighting that revenue and ARR were up by 46% and 44%, respectively, compared to the same period in 2020. The press release also quoted Sprout Social’s CEO, stating that the “outperformance this quarter was driven by accelerated momentum in our large-customer cohorts, underscoring the quality of our growth. We’re pleased to deliver very strong ACV [annual contract value] growth and we see even greater future opportunities as our customers operationalize social.” On the corresponding earnings conference call that day, Sprout Social’s CFO likewise stated, “[o]ur ongoing momentum into the mid-market enterprise and mix shift towards annual and multi-year contracts are each having a positive impact.”
Then, following the close of the markets on August 3, 2023, Sprout Social lowered its full-year revenue guidance and issue a press release announcing its acquisition of Tagger Media, Inc., a leading influencer marketing and social intelligence platform, for cash consideration of $140 million “funded with a combination of cash from Sprout Social’s balance sheet and Sprout’s newly established revolving credit facility.” Sprout Social noted that the acquisition “expands Sprout Social into the influencer marketing category and extends social media platform to deliver comprehensive workflow, reporting and intelligence.” Following this news, the price of Sprout Social stock fell 12.3%, from a closing price of $53.38 per share on August 3, 2023, to a closing price of $46.81 per share on August 4, 2023.
On May 2, 2024, Sprout Social announced the company's operating results for the first fiscal quarter of 2024, disclosing that Sprout Social had missed its revenue guidance for the quarter and revised its full year 2024 revenue guidance downward by $20 million. In addressing the results, Sprout Social's CFO said that the company had "underestimated the magnitude of enterprise seasonality" and had also been "self-inducing sales execution headwinds." During the accompanying earnings call held that same day, Sprout Social's incoming CEO additionally disclosed that Sprout Social "made several important strategic decisions heading into Q1" which it "thought [it] could manage [] without disruption, but they collectively set us back."
On this news, Sprout Social's stock price fell $19.33 per share, or 40.15%, to close at $28.82 per share on May 3, 2024.
WHAT CAN I DO?
Sprout Social investors may, no later than July 12, 2024, seek to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check, LLP or other counsel, or may choose to do nothing and remain an absent class member. Kessler Topaz Meltzer & Check, LLP encourages Sprout Social investors who have suffered significant losses to contact the firm directly to acquire more information. The class action complaints against Sprout Social, Munch v. Sprout Social, Inc., et al., Case No. 24-cv-03867, and City of Hollywood Police Officers’ Retirement System v. Sprout Social, Inc., et al., Case No. 24-cv-05582, are filed in the United States District Court for the Northern District of Illinois.
CLICK HERE TO SIGN UP FOR THE CASE OR GO TO: https://www.ktmc.com/new-cases/sprout-social-inc?utm_source=PR&utm_medium=link&utm_campaign=spt&mktm=r
WHO CAN BE A LEAD PLAINTIFF?
A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. The lead plaintiff is usually the investor or small group of investors who have the largest financial interest and who are also adequate and typical of the proposed class of investors. The lead plaintiff selects counsel to represent the lead plaintiff and the class and these attorneys, if approved by the court, are lead or class counsel. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.
ABOUT KESSLER TOPAZ MELTZER & CHECK, LLP
Kessler Topaz Meltzer & Check, LLP prosecutes class actions in state and federal courts throughout the country and around the world. The firm has developed a global reputation for excellence and has recovered billions of dollars for victims of fraud and other corporate misconduct. All of our work is driven by a common goal: to protect investors, consumers, employees and others from fraud, abuse, misconduct and negligence by businesses and fiduciaries. The complaint in this action was not filed by Kessler Topaz Meltzer & Check, LLP. For more information about Kessler Topaz Meltzer & Check, LLP please visit www.ktmc.com.
CONTACT:
Kessler Topaz Meltzer & Check, LLP
Jonathan Naji, Esq.
(484) 270-1453
280 King of Prussia Road
Radnor, PA 19087
info@ktmc.com
May be considered attorney advertising in certain jurisdictions. Past results do not guarantee future outcomes.
