NEW YORK, December 27, 2021 (GLOBE NEWSWIRE) – Pomerantz LLP announces that a class action lawsuit has been filed against StoneCo Ltd. (NASDAQ: STNE) and some of its executives. The class action suit, filed in the United States District Court for the Southern District of New York, and registered as 21-cv-10468 is in the name of a group consisting of all persons and entities other than the defendants who have purchased or otherwise acquired securities of StoneCo between March 11, 2021 and November 16, 2021 inclusive (the âClass Periodâ). The plaintiff is pursuing actions against the defendants under the Securities Exchange Act of 1934 (the “Exchange Act”).
If you are a shareholder who purchased StoneCo securities during the Class Period, you have until January 18, 2022 to request the court to appoint you as the primary claimant for the Class Action. A copy of the complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll free, Ext. 7980. Those inquiring by e-mail are encouraged to provide their mailing address, telephone number and the number of shares purchased.
[Click here for information about joining the class action]
StoneCo is a provider of financial technology solutions. StoneCo’s services enable merchants and other sellers to conduct e-commerce through in-store, online and mobile channels, primarily in Brazil.
The complaint alleges that throughout the Class Period, the Defendants made materially false and / or misleading statements, and failed to disclose material adverse facts regarding the business, operations and prospects of the Company. Specifically, the Defendants failed to disclose to investors: (1) that StoneCo was having difficulty implementing its credit product; (2) that StoneCo faced significant risks through its point of sale provider, PAX Global Technology Ltd. ; (3) that due to the above, the financial results of the Company would be adversely affected; and (4) that due to the foregoing, the Defendants’ positive statements regarding the business, operations and prospects of the Company were materially misleading and / or lacked reasonable basis.
On August 30, 2021, after the market closed, StoneCo announced its second quarter 2021 financial results in a press release, reporting an 8.1% decline in year-over-year revenue “primarily due to fair value credit adjustments and significantly lower credit disbursements. . The company said it had ‘implemented prudent measures, such as temporarily halting credit disbursement and increasing coverage of potential future losses, which had an impact on [StoneCoâs] released the results for the quarter.
Following this news, the Company’s share price fell $ 2.96 to close at $ 46.54 per share on August 31, 2021, on unusually high trading volume.
Then, on October 26, 2021, the offices of PAX Global Technology Ltd in Florida were raided by the United States Federal Bureau of Investigation, the Department of Homeland Security and several other agencies as part of a federal investigation. Like a Viceroy Research October 27, 2021 report pointed out, StoneCo says PAX “is no longer [its] single point of sale service provider, [but the Company is] still heavily dependent on it to manufacture and assemble a substantial amount of [its] Point of sale devices. Additionally, another company replaced their PAX terminals “because they did not receive satisfactory responses from PAX regarding their point-of-sale terminals connecting to websites not listed in the documentation provided.”
Following this news, the company’s stock price fell $ 2.64, or 7%, to close at $ 33.81 per share on October 27, 2021, further hurting investors.
Then, on November 16, 2021, StoneCo announced that it would “begin to retest our [credit] product, which are short-term loans, between the fourth quarter of ’21 and the first quarter of ’22. The Company was unable to provide specific indications as to when credit volumes would return to levels before StoneCo halted the credit origination.
Following this news, the company’s stock price fell $ 10.96, or 34%, to close at $ 20.70 per share on November 17, 2021, further hurting investors.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Paris and Tel Aviv, is recognized as one of the leading firms in the areas of corporate, securities and antitrust litigation. Founded by the late Abraham L. Pomerantz, known as the Dean of the Class Actions Bar, Pomerantz was a pioneer in the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breach of fiduciary duty and professional misconduct. The firm has recovered numerous multi-million dollar damages on behalf of the members of the group. See www.pomlaw.com.
Robert S. Willoughby
888-476-6529 ext 7980