A class action lawsuit was filed against Malibu Boats, Inc. (NASDAQ:MBUU) on April 29, 2024. The plaintiffs (shareholders) alleged that they bought MBUU stock at artificially inflated prices between November 4, 2022 and April 11, 2024 (Class Period) and are now seeking compensation for their financial losses. Investors who bought MBUU stock during that period can click here to learn about joining the lawsuit.
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Malibu Boats designs, manufactures, and markets a wide variety of recreational powerboats, including performance sport, sterndrive, and outboard boats. Malibu operates through various brands including Malibu, Axis, Cobalt, Pursuit, Cobia, Pathfinder, Maverick, and Hewes.
The plaintiffs maintain that Malibu Boats and four of its current and/or former senior officers deceived investors by lying and withholding vital information about the company’s business practices and prospects during the Class Period. Particularly, they are accused of omitting truthful information about the company’s sales performance, its conduct with respect to dealers, and ancillary matters from the SEC filings and related material.
The truth became clear on two occasions. On February 20, Malibu Boats abruptly announced leadership changes. The company disclosed that CEO Jack Springer will exit his role effective May 17. Furthermore, on April 11, the company disclosed that one of its dealers, Tommy’s Boats, had filed a lawsuit against Malibu Boats. Tommy’s alleged that Malibu Boats “engaged in an elaborate scheme” to “pump nearly $100 million” worth of inventory into its dealerships since late 2022 to “artificially inflate Malibu’s sales performance.”
Interestingly, during the Class Period, Malibu Boats consistently reiterated the continued demand for its boats.
As per the class action lawsuit, Malibu caused its stock to trade at artificially inflated prices by knowingly and recklessly misleading investors about the company’s business practices during the Class Period.
Notably, MBUU stock has plunged roughly 33% so far in 2024, causing massive damage to shareholders’ returns.
