CASES
CPI Corp.
Class Period: Apr 20, 2010 to Dec 21, 2011
Lead Plaintiff Deadline: Mar 13, 2012
Summary of Case:
A securities class action has been filed against CPI Corp. ("CPI" or the "Company") on behalf of all persons who purchased or otherwise acquired the common stock of CPI between April 20, 2010 and December 21, 2011, inclusive (the "Class Period"). This case has been filed in the USDC - Missouri (Eastern).
The Complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results. Defendants represented that the Company's initiatives to grow the business were working, that it was well positioned for growth and that its stock was a "good investment" when it was trading at $22 per share. As a result of defendants' false statements, CPI stock traded at artificially inflated prices during the Class Period, reaching a high of $31.91 per share on May 12, 2010. 4. On December 22, 2011, the Company announced its financial results for its third fiscal quarter ended November 12, 2011.1 The Company reported a net loss of ($7.25) million or ($1.03) diluted earnings per share ("EPS") for the third quarter, down from a loss of ($7.71) million during the same quarter of 2010. The Company further reported that net sales declined 11% to $95.0 million, due in significant part to the Company's comparable store sales declines, offset by cost reductions and one-time costs associated with the opening of certain Portrait Gallery studio locations. The results also meant that CPI had failed its leverage ratio test for its revolving credit facility. CPI had to obtain an amendment to its credit agreement or it would have failed. As a result, CPI will have to stop its dividend.
On this news, CPI stock collapsed $3.30 per share to close at $1.98 per share on December 22, 2011, a one-day decline of nearly 63% on volume of 4.8 million shares.
If you purchased this company's shares during the Class Period and suffered a loss or for further information about the case, please review the links below.