United Natural Foods Inc. (UNFI) is at the center of a class action filed on behalf of investors who purchased or acquired UNFI securities between March 10, 2021 and March 7, 2023, for violations of the Securities Exchange Act of 1934.
The suit alleges that the company "made materially false and misleading statements throughout the Class Period." Specifically, as outlined in a press release, the complaint points to failure to disclose that:
- Despite its cost saving Value Path initiative, UNFI had not invested in improving its data management and related infrastructure;
- UNFI could not respond adequately to cost changes, such as inflationary pressure;
- UNFI could not appreciate the benefits of procurement and inventory gains achieved during fiscal 2022;
- UNFI's profitability would be materially adversely impacted.
On March 8, 2023, UNFI announced its Q2 2023 financial results. UNFI reported that, compared to Q2 2022 results, net sales increased 5.4%, while gross profit decreased $6 million, or 0.6%.
According to the complaint, UNFI reported that that its profits "were challenged as we did not repeat the significant level of procurement gains from rapidly accelerating inflation and inventory gains, due to supply chain volatility, that we experienced in the second quarter of last year.” Following this news on March 8, UNFI stock price fell $11.49, or 28.1%.
According to the complaint, UNFI reported that that its profits "were challenged as we did not repeat the significant level of procurement gains from rapidly accelerating inflation and inventory gains, due to supply chain volatility, that we experienced in the second quarter of last year.” Following this news on March 8, UNFI stock price fell $11.49, or 28.1%.
The lawsuit seeks to recover losses on behalf of investors who were adversely affected.
