Securities Class Action Filed Against Endurance International Group Holdings, Inc.
Violations of federal securities laws as a result of a series of materially false statements. Endurance provides cloud-based platform solutions for small- and medium-sized businesses. The Complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose to investors that: (1) the Company overstated its 2014 average revenue per subscriber and organic growth rate; (2) the Company engaged in irregular accounting practices related to its international business; and (3) that, as a result of the foregoing, the Company’s statements about its business, operations, and prospects were false and misleading and/or lacked a reasonable basis. According to the Complaint, Gotham City Research, LLC published a report on April 28, 2015 alleging, among other things, that 40% to 100% of Endurance’s reported profits were suspect and that the Company’s normalized profits would be insufficient to cover its interest expenses. The report alleged that the Company uses related parties to inflate earnings, and that various accounting irregularities relating to the Company’s international business existed. The report also alleged that the Company’s reported organic growth rate was overstated and that 2014 Average Revenue per Subscriber (“ARPS”) had actually declined 13%, when the Company’s 10-K claimed that ARPS had grown 11%. Following this news, shares of Endurance declined by more than 10%, to close on April 28, 2015 at $19.70 per share, on unusually heavy volume. Filed in D. Mass.
Lead Plaintiff Deadline: The deadline to file for lead plaintiff in this action is 7/3/2015.
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