Weight Watchers International, Inc.
- Company Name
- Weight Watchers International, Inc.
- Stock Symbol
- Class Period
- May 4, 2018 to February 26, 2019
- Motion Deadline
- May 3, 2019
- Southern District of New York
On March 4, 2019, Robbins Geller Rudman & Dowd LLP filed a complaint alleging violations of the federal securities laws by Weight Watchers International, Inc. and certain of its officers and/or directors. The class action was commenced in the United States District Court for the Southern District of New York on behalf of purchasers of Weight Watchers securities between May 4, 2018 and February 26, 2019 (the “Class Period”).
ROBBINS GELLER RUDMAN & DOWD LLP FILES CLASS ACTION SUIT AGAINST WEIGHT WATCHERS INTERNATIONAL, INC.
New York – March 4, 2019 – Robbins Geller Rudman & Dowd LLP (http://www.rgrdlaw.com/cases/wwinc/) today announced that a class action has been commenced on behalf of purchasers of Weight Watchers International, Inc. (NASDAQ:WTW) common stock during the period between May 4, 2018 and February 26, 2019 (the “Class Period”). This action was filed in the Southern District of New York and is captioned Potts v. Weight Watchers Int’l, Inc., et al., No. 19-cv-2005.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Weight Watchers common stock during the Class Period to seek appointment as lead plaintiff. A lead plaintiff acts on behalf of all other class members in directing the litigation. The lead plaintiff can select a law firm of its choice. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or Mary K. Blasy of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. You can view a copy of the complaint as filed at http://www.rgrdlaw.com/cases/wwinc/.
The complaint charges Weight Watchers, certain of its officers and its controlling shareholder with violations of the Securities Exchange Act of 1934. Weight Watchers is a subscription-based commercial weight-management program that offers various products and services to assist weight loss and maintenance internationally.
The complaint alleges that during the Class Period, defendants made false and misleading statements and/or failed to disclose adverse information regarding Weight Watchers’ business, operations and prospects. Specifically, the complaint alleges defendants failed to disclose that Weight Watchers was experiencing diminished subscriber demand attributable to the onslaught of new competing smartphone fitness apps, meal-delivery services, and other tech advances that were driving down Weight Watchers’ new subscriber growth and its subscriber retention rates; that diminished subscriber growth, when coupled with a much larger number of fourth quarter subscription lapses than Weight Watchers typically experienced, made it highly unlikely that the Company would retain four million subscribers by the end of 2018; that Weight Watchers was not on track to grow its subscriber count to five million or to drive annual revenues to more than $2 billion by the end of 2020; and that a decreased subscriber count would result in decreased revenues and profits. As a result of defendants’ false statements and/or omissions, the price of Weight Watchers common stock was artificially inflated to more than $103 per share during the Class Period.
On November 1, 2018, Weight Watchers announced disappointing financial results for the third quarter of 2018, ended September 30, 2018. Weight Watchers reported that it had lost 300,000 subscribers in the quarter, bringing its subscriber count down to 4.2 million, causing the Company’s reported net revenues of $366 million to significantly underperform the $379 million defendants had led the market to expect. On this news, the price of Weight Watchers common stock declined almost 30%, to close at $48.13 per share on November 2, 2018.
Then on February 26, 2019, after the close of trading, Weight Watchers announced its financial results for the 2018 fourth quarter and fiscal year. The fourth quarter subscriber count had fallen again, this time to 3.9 million, and defendants admitted that enrollment would continue declining during fiscal year 2019 (“FY19”), with CEO Mindy Grossman conceding that even though January is typically the best time for health-focused brands, January had been a particularly “hard month” for Weight Watchers. The Company said that it was now only targeting revenues of $1.4 billion during FY19, nowhere near the $2 billion in annual revenues it had been projecting it would achieve by the end of 2020 and well below the nearly $1.7 billion it had led the market to expect for FY19. Weight Watchers also disclosed that it was now only targeting earnings per share of $1.25 to $1.50 for FY19, far lower than the $3.36 defendants had led the market to expect. The price of Weight Watchers common stock declined 34% on this news, falling $10.20 per share to close at $19.37 per share on February 27, 2019.
Plaintiff seeks to recover damages on behalf of all purchasers of Weight Watchers common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.
Robbins Geller is one of the world’s leading law firms representing investors in securities litigation. With 200 lawyers in 10 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For five consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Please visit http://www.rgrdlaw.com for more information.
Robbins Geller Rudman & Dowd LLP
Samuel H. Rudman, 800-449-4900
Mary K. Blasy