If you suffered losses exceeding $100,000 investing in Driven Brands stock or options between October 27, 2021 and August 1, 2023 and would like to discuss your legal rights, call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310). You may also click here for additional information: www.faruqilaw.com/DRVN.
There is no cost or obligation to you.
NEW YORK, Jan. 05, 2024 (GLOBE NEWSWIRE) — Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Driven Brands Holdings Inc. (“Driven Brands” or the “Company”) (NASDAQ: DRVN) and reminds investors of the February 20, 2024 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
Faruqi & Faruqi is a leading minority and Woman-owned national securities law firm with offices in New York, Pennsylvania, California and Georgia.
As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) statements concerning Driven’s ability to efficiently and effectively integrate a high volume of acquired businesses, including statements related to the status of integrating its U.S. auto glass businesses; and (2) statements concerning the performance and competitive position of Driven Brands’ car wash business segment. Specifically, throughout the Class Period, Defendants repeatedly touted Driven Brands’ ability to execute and integrate acquisitions as a “core strength,” and assured investors that it had made “significant progress” integrating the auto glass businesses it had acquired. The Company also represented that the large scale of its car wash business served as a “competitive moat” that would preserve Driven Brands’ competitive position. While Driven Brands acknowledged some “softness” in customer demand for its car wash business segment, the Company downplayed that issue and pointed investors to the growth of its car wash subscriptions, which Driven labeled as the “Holy Grail” in the car wash business.
The truth began to emerge on May 8, 2023, when Driven Brands revealed that, on May 4, 2023, the Company’s former Chief Financial Officer, Defendant Tiffany L. Mason (“Mason”), had abruptly left the Company under unusual circumstances. Mason’s exit came just one day after Driven reported its financial results for the first quarter of 2023.
Then, on August 2, 2023, Driven Brands reported earnings for the second quarter of 2023 that missed expectations, including disappointing results for its Paint, Collision and Glass business segment as well as its Car Wash segment. With respect to its auto glass business, the Company admitted that it was at least “several quarters” behind on its integration of the businesses it had acquired. In addition, regarding Driven Brands’ Car Wash segment, the Company disclosed that increased exposure to “intensified competitive intrusion” negatively impacted demand from Driven Brands’ high-margin retail car wash customers. As a result of delays in Driven Brands’ integration of its acquired auto glass businesses and the faltering performance of its car wash businesses, the Company slashed its full-year earnings guidance for fiscal 2023, despite having reaffirmed that guidance a little over two months earlier.
As a result, on August 2, 2023, these disclosures caused the price of Driven Brands common stock to decline by $10.63 per share, or 41%.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. 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. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Driven Brands’ conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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