SAN DIEGO — Investors who bought shares of Celsius Holdings, Inc. during a specific six-month period this year must decide by January 21, 2025, if they wish to be appointed as lead plaintiff in a class action lawsuit against the company. The lawsuit, formally named Shelby Township Police & Fire Retirement System v. Celsius Holdings, Inc., was filed in the Southern Florida District Court and cites potential violations of the Securities Exchange Act of 1934 by Celsius and several of its senior executives.
The case addresses allegations that Celsius Holdings, a company that markets and distributes energy drinks and supplements, provided misleading information about its financial health and business operations. Primarily, it is claimed that Celsius extensively oversold inventory to major distributor PepsiCo, Inc. beyond actual market demand, leading to a sales downturn as excess stocks were drawn down by Pepsi.
The lawsuit contends that Celsius falsely portrayed the state of its financial health during the designated class period, February 29, 2024, through September 4, 2024, misleading investors about the sustainability of its sales rates and overall financial trajectory. This allegedly included not disclosing to investors the impending decrease in purchases by Pepsi, which had a significant impact on the revenue figures.
Notably, Celsius’s stock price experienced substantial drops following key announcements. On May 27, 2024, the stock fell nearly 13% after retail store trends analyzed by Nielsen indicated a potential oversupply issue. The situation worsened when, on September 4, Celsius executives confirmed a drastic reduction in orders from Pepsi — from projections of $100 million to $120 million in previous quarters to similar figures less in actual orders, causing another stock price drop of over 11%.
Further revelations came on November 6, 2024, when Celsius disclosed that its revenue for the third quarter of 2024 was $265.7 million, a sharp 31% decline from the previous year. Revenue from North American operations and specifically from Pepsi had significantly decreased, impacting overall profit margins and leading to another decrease in stock value by 5%.
The lawsuit is spearheaded by the law firm Robbins Geller Rudman & Dowd LLP, renowned for its track record in leading complex investor class action lawsuits and securing substantial monetary reliefs. Investors affected during the class period are encouraged to step forward if they wish to play a lead role in the litigation process.
Investors should note, however, that their eligibility to partake in any future recovery does not hinge on their status as lead plaintiff. Contact information for legal advice includes reaching out to attorneys J.C. Sanchez or Jennifer N. Caringal at Robbins Geller either by phone or via email for further inquiries.
Given the detailed allegations and implications for future litigation, this case marks a significant point of interest for investors and market watchers alike, reflecting broader concerns about corporate transparency and accountability in financial disclosures.
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