SAN DIEGO--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/bestbuy/) today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the District of Minnesota on behalf of purchasers of Best Buy Co., Inc. (“Best Buy”) (NYSE:BBY) common stock during the period between September 14, 2010 and December 13, 2010 (the “Class Period”).
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, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at djr@rgrdlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/bestbuy/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Best Buy and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Best Buy is a leading retailer of consumer electronics.
The complaint alleges that during the Class Period, defendants made false and misleading statements concerning demand for the Company’s consumer electronics product offerings and the Company’s true financial condition. Specifically, the complaint alleges that the following facts were known to defendants or deliberately disregarded during the Class Period: (a) demand for Best Buy consumer electronics product offerings was weak or declining and could not support the Company’s aggressive fiscal year (“FY”) 2011 sales, revenue, and earnings forecasts; (b) the Company’s FY 2011 earnings forecast could not be achieved without substantial earnings management and, in particular, a sharp reduction and curtailment of SG&A expenses and aggressive share repurchases which reduced the Company’s outstanding shares and increased reported earnings; and (c) despite defendants’ statements to the contrary, and because of weak sales demand known to defendants or deliberately disregarded, as of September 14, 2010, the Company was not “on track to deliver and exceed [its] annual EPS guidance” of $3.70 per share.
On December 14, 2010, the Company reported its third quarter 2011 financial results. According to the complaint, the Company reported that as product sales it knew to be weak or declining even as early as June 2010 had continued across the board, it had missed Wall Street revenue expectations by a wide margin, reporting $0.54 per share, compared to Wall Street consensus estimates of $0.61. In addition, as a result of weak sales demand and despite the increased FY 2011 earnings forecast in September 2010, the Company slashed its FY 2011 earnings forecast of $3.55-$3.70 to $3.20-$3.40 – well below even the initial FY 2011 earnings forecasts set in March 2010. Finally, the Company disclosed that it had repurchased 11 million shares in the quarter, for a total of more than 31 million shares repurchased during the first three quarters of FY 2011, which would have a $0.12 per share positive impact on the reduced FY 2011 EPS forecast of $3.20-$3.40. On this news there was an immediate and massive sell off of the Company’s shares on December 14, 2010, and a stock price decline of 22% from a Class Period high of $45.63 per share to close at $35.52 per share on December 14, 2010.
Plaintiff seeks to recover damages on behalf of all purchasers of Best Buy common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller, a 180-lawyer firm with offices in San Diego, San Francisco, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Robbins Geller Web site (http://www.rgrdlaw.com) has more information about the firm.