Hayward Holdings, Inc.
Lead Plaintiff Deadline 10/02/2023
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court of New Jersey on behalf of those who acquired Hayward Holdings (“Hayward” or the “Company”) (NASDAQ: HAYW) securities during the period from March 2, 2022 through July 27, 2022. Investors have until October 2, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Hayward operates as a holding company and manufactures residential pool equipment through its subsidiaries, designs, and markets.
On July 28, 2022, Hayward issued a release announcing the Company’s financial results for the second fiscal quarter of 2022 (the “2Q22 release”). In the 2Q22 release, the Company stated its expectations for its channel partners to reduce their Hayward inventory on hand by approximately four to six weeks in the second half of the year. As a result, the Company reduced its 2022 full year guidance to reflect a massive inventory reduction in the second half of 2022. Hayward cut its expected 2022 net sales growth from a range of 9% to 12% to a decline of 2% to 6%. In addition, Hayward reduced its expected 2022 adjusted earnings from a range of $460 million to $475 million to a range of just $385 million to $400 million, a 16% decline at the mid-point. On this news, the price of Hayward shares declined by $2.50 per share, or approximately 18.23%, from $13.71 per share to close at $11.21 on July 28, 2022.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose: (i) Hayward and its management had engaged in a channel-stuffing scheme designed to artificially boost the Company’s short-term sales and earnings; (ii) Hayward had flooded its channel partners with inventory that they did not want or need at a level that far outpaced then-existing consumer demand; (iii) Hayward channel partners were suffering from an inventory glut as a result of the channel-stuffing scheme that would require a massive de-stocking in the second half of 2022; (iv) Hayward channel-stuffing scheme had cannibalized future sales, materially impairing the Company’s ability to sell to its customers; (v) the demand for pool equipment had slowed down, which, combined with flooding channel partners with more inventory, led to an inventory glut and the need for these channel partners to reduce inventory levels; and (vi) as a result of the above, Hayward’s projected 2022 financial results were not achievable and lacked a reasonable basis in fact.
Hayward operates as a holding company and manufactures residential pool equipment through its subsidiaries, designs, and markets.
On July 28, 2022, Hayward issued a release announcing the Company’s financial results for the second fiscal quarter of 2022 (the “2Q22 release”). In the 2Q22 release, the Company stated its expectations for its channel partners to reduce their Hayward inventory on hand by approximately four to six weeks in the second half of the year. As a result, the Company reduced its 2022 full year guidance to reflect a massive inventory reduction in the second half of 2022. Hayward cut its expected 2022 net sales growth from a range of 9% to 12% to a decline of 2% to 6%. In addition, Hayward reduced its expected 2022 adjusted earnings from a range of $460 million to $475 million to a range of just $385 million to $400 million, a 16% decline at the mid-point. On this news, the price of Hayward shares declined by $2.50 per share, or approximately 18.23%, from $13.71 per share to close at $11.21 on July 28, 2022.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose: (i) Hayward and its management had engaged in a channel-stuffing scheme designed to artificially boost the Company’s short-term sales and earnings; (ii) Hayward had flooded its channel partners with inventory that they did not want or need at a level that far outpaced then-existing consumer demand; (iii) Hayward channel partners were suffering from an inventory glut as a result of the channel-stuffing scheme that would require a massive de-stocking in the second half of 2022; (iv) Hayward channel-stuffing scheme had cannibalized future sales, materially impairing the Company’s ability to sell to its customers; (v) the demand for pool equipment had slowed down, which, combined with flooding channel partners with more inventory, led to an inventory glut and the need for these channel partners to reduce inventory levels; and (vi) as a result of the above, Hayward’s projected 2022 financial results were not achievable and lacked a reasonable basis in fact.