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Normally, when Maryland-based clothier Joseph A. Bank
(NASDAQ: JOSB) increases it sales, its income
increases. That didn't happen this year.
Specifically, on June 8, 2006, before the opening of trading,
the Company disclosed its sales and earnings for the first
quarter of the fiscal year ending February 3, 2007. The
Company revealed, among other things, that: (1) its year
over year net income declined approximately 12%; and
(2) its gross profit declined primarily as a result of customers
favoring 'fall merchandise' over its 'year-round core
merchandise'. The Company also issued financial guidance
for fiscal 2006 that was up to 20% below analyst estimates.
This announcement stunned the market. On June 8, 2006,
shares declined $10.73 per share or approximately 30%,
from $37.13 per share to $26.40 per share on heavier
than usual volume.
Based on the Company's past track record, investors
presumed that increased sales would translate into increased
earnings. When Joseph Bank belatedly announced the
impact of its deeply discounted sales on its income, there
was a rush to sell.
One person who wasn't surprised by this development and
didn't need to rush to unload his shares was the Company's
CEO, Roger N. Wildrick. Earlier this year, while he was
touting the current and future operational and financial
strengths of Joseph A. Bank, he also sold over $35 million
worth of stock. He knew when to sell.
It appears that investors who purchased JOSB between
January 5, 2006 and June 7, 2006, are affected.
Three Companies with Accounting 'Issues'
Even with Sarbanes-Oxley, a surprising number of companies
still have accounting 'issues'. Unfortunately, when a
company announces that it has to restate its prior financials,
its stock typically takes a big hit. Consider the following
situations:
On April 10, 2006, Zale Corporation (NYSE: ZLC) announced
the SEC had initiated a non-public investigation relating
to various accounting issues and other matters.
Shareholder litigation has been brought against the
Company and investors who purchased between
February 18, 2005 and May 5, 2006, are affected.
Before the opening of trading on July 10, 2006,
The Shaw Group Inc. (NYSE: SGR) announced that its
management concluded that two errors occurred in the
preparation of its second quarter financial statements
(ended February 28, 2006) which require a restatement
of the second quarter results. As a result, its stock
dropped 14% on heavier than usual volume. It appears
that investors who purchased Shaw between
April 4, 2006 and July 7, 2006, are affected.
Terayon Communication Systems, Inc. (NASDAQ: TERN)
disclosed earlier this year that it was restating its
financial statements for the year ended December 31, 2004
and the first two quarters of the year ended
December 31, 2005. Investors who purchased TERNE
between October 28, 2004 and March 1, 2006, are affected.
If you are an affected investor in any of the companies
mentioned above or any of the companies involved in
the backdated options scandal that are listed below,
you may wish to contact us at info@securitiessleuth.com
or 877.511.4717 to discuss your options.
The backdated stock option scandal continues to grow
and in a number of instances, investors in affected
companies have been negatively affected. You may want
to check your portfolio for the following companies:
Affiliated Computer Services Inc. (NYSE: ACS),
Altera Corp (NASDAQ: ALTR), CNET Networks
(NASDAQ: CNET), F5 Networks Inc. (NASDAQ: FFIV),
M-Systems Flash Disk Pioneers Ltd (NASDAQ: FLSH),
Power Integrations Inc. (NASDAQ: POWI),
Quest Software Inc. (NASDAQ: QSFT), Rambus Inc.
(NASDAQ: RMBS), SafeNet Inc. (NASDAQ: SFNT) and
Semtech (NASDAQ: SMTC).
Now with respect to settled cases. If you are an affected
investor - you purchased any of these stocks during the
relevant class period, you may wish to contact the claims
administrator to obtain additional information. Remember,
if you don't submit your claim form, you won't receive your
share of any settlement.
Symbol Technology, Inc. (SBL)
Class Period: March 2, 2000 tp October 17, 2002
Claims Deadline: October 31, 2006
Claims Administrator: A.B. Data
Tellium, Inc. (TELM)
Class Period: May 17, 2001 to July 1, 2002
Claims Deadline: October 18, 2006
Claims Administrator: Analytics
Information regarding other recent settled cases, including
the cases listed below can be found at www.securitiessleuth.com.
Imperial Chemical Industries PLC (ICI)
Vistacare, Inc. (VSTA)
ARM Financial Group (ARMGQ)
Carreker Corp. (CANI)
Loewen Group Inc. (LWN)
Razorfish, Inc. (RAZF)
Again you should contact the claims administrator (rather than us).
However, if you are an affected investor in any of the
companies under investigation, you many wish to contact
us so that you can consider your options.
Likewise, if you happen to be aware of corporate restatements
or other financial fraud -- especially if you're a victim --
you're encouraged to contribute to the Sleuth by giving your
own tip-offs at www.securitiessleuth.com or by e-mailing
info@securitiessleuth.com. You can also call Mark McNair
at 877-511-4717. If you have a friend or colleague you
think would benefit from The Sleuth, please pass along
this issue and ask them to sign up at
www.cartville.com/app/join.asp?MerchantID=47994.
Warmest regards,
Mark McNair
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