LOS ANGELES--(BUSINESS WIRE)--Glancy Prongay & Murray LLP (“GPM”), a leading national shareholder rights law firm, announces that a class action lawsuit has been filed on behalf of investors who purchased or otherwise acquired Shoals Technologies Group, Inc. (“Shoals” or the “Company”) (NASDAQ: SHLS) common stock between May 17, 2022 and November 7, 2023, inclusive (the “Class Period”). Shoals investors have until May 21, 2024 to file a lead plaintiff motion.
If you suffered a loss on your Shoals investments or would like to inquire about potentially pursuing claims to recover your loss under the federal securities laws, you can submit your contact information at www.glancylaw.com/cases/Shoals-Technologies-Group-Inc/. You can also contact Charles H. Linehan, of GPM at 310-201-9150, Toll-Free at 888-773-9224, or via email at shareholders@glancylaw.com to learn more about your rights.
On August 1, 2023, Shoals disclosed that it had recorded a warranty liability of $9.3 million related to an issue involving “a subset of wire harnesses used in [Shoals’ electrical balance of system (“EBOS”)] solutions presenting excessive pull back of wire insulation at connection points,” which Shoals dubbed “shrinkback.”
Then, on November 7, 2023, Shoals revealed that it had taken an additional $50.2 million charge for warranty expense as a result of the shrinkback issue. The Company further stated that it expected the shrinkback issue to cost between $59.7 million and $184.9 million to remedy.
On this news, Shoals’ stock price fell $3.28, or 20.2%, to close at $12.95 per share on November 9, 2023, thereby injuring investors.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) Shoals did not deliver EBOS products that met the highest levels of quality and reliability; (2) Shoals had received reports of exposed copper conduit in EBOS wire harnesses in a large number of solar fields and was aware that a significant portion of its wire harnesses had defects; (3) Shoals would have to incur between $60 million to $185 million in costs to remediate the wire shrinkback issue; and (4) Shoals had understated its cost of revenue by millions of dollars; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Follow us for updates on LinkedIn, Twitter, or Facebook.
If you purchased or otherwise acquired Shoals common stock during the Class Period, you may move the Court no later than May 21, 2024 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you wish to learn more about this action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Charles Linehan, Esquire, of GPM, 1925 Century Park East, Suite 2100, Los Angeles California 90067 at 310-201-9150, Toll-Free at 888-773-9224, by email to shareholders@glancylaw.com, or visit our website at www.glancylaw.com. If you inquire by email please include your mailing address, telephone number and number of shares purchased.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
