According to the law firm press release, Dick’s Sporting Goods, Inc. is a sporting goods retailer that offers a broad selection of brand name sporting goods equipment, apparel, and footwear. The Company owns and operates Golf Galaxy, Inc., Field & Stream and other specialty chain stores.
Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Dick’s had overstated its adjusted EBITDA amounts; (ii) accordingly, the Company lacked effective internal controls; and (iii) as a result of the foregoing, Dick’s public statements were materially false and misleading at all relevant times.
On May 12, 2017, Dick’s issued a Current Report filed on Form 8-K/A with the Securities and Exchange Commission, reporting that a “computation error resulted in a $23.4 million overstatement of Adjusted EBITDA amounts for both the 13 weeks and 52 weeks ended January 28, 2017”.
On this news, Dick’s share price fell $2.62 or 5.22%, over the following two trading days, to close at $47.57 on May 15, 2017.
On May 16, 2017, Dick’s announced that sales at its existing stores in the first quarter of 2016 had fallen short of forecasts and advised investors that the Company planned to scale back new store openings in 2018 and 2019.
On this news, Dick’s share price fell as much as $6.82, or 14.34%, during intraday trading on May 16, 2017.