Meredith Corporation (NYSE:MDP)
A class action has been filed in the United States District Court for the Southern District of Iowa on behalf of purchasers of Meredith Corporation (NYSE:MDP) securities during the period between January 31, 2018 and September 5, 2019 (the “Class Period”).
The complaint charges Meredith and certain of its officers and/or directors with violations of the Securities Exchange Act of 1934. Meredith is a media company that operates national media and local media business segments over print, digital, mobile, video, and broadcast television. On January 31, 2018, Meredith announced it had completed the acquisition of Time, Inc. for $2.8 billion.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements and/or failed to disclose adverse information regarding the Company’s business and operations. Specifically, defendants failed to disclose: (i) that the Company’s financial reporting was deficient in its controls for establishing the fair value of the assets and liabilities that Meredith had acquired from Time; (ii) that integrating Time’s assets and elevating advertising revenue from the print and digital performance of Time’s assets would occur over a series of years and require additional investment spending; and (iii) that the substantial number of low-margin magazine subscriptions inside the legacy Time brands would require additional investment spending. As a result of this information being withheld from the market, Meredith securities traded at artificially inflated prices during the Class Period.
Then on September 5, 2019, when Meredith announced its fourth quarter and full year 2019 financial results, it admitted that it had “taken longer than [it] initially expected to elevate the print and digital performance of the Time Inc. assets,” and that “comparable advertising performance lagged Meredith’s expectations in the first half of fiscal 2019.” In a conference call the same day, the Company’s CEO explained that due to the underperformance of the Time assets, Meredith had significantly missed it previously announced guidance. On this news, the price of Meredith stock fell more than 20%, to close at $33.68 per share on September 5, 2019.
If you are a current shareholder and/or purchased stock during the period between January 31, 2018 and September 5, 2019, and would like to discuss your options of exercising your rights as a shareholder, please contact us.
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