Berger & Montague P.C issued the following announcement on April 29
Berger Montague is investigating securities fraud claims against GSX Techedu Inc. (“GSX” or the “Company”) on behalf of all purchasers of GSX American Depositary Shares (“ADSs”) (NYSE: GSX) between June 6, 2019 and April 13, 2020 (the “Class Period”).
If you purchased GSX shares, have information, would like to discuss this investigation, or have any questions concerning your rights or interests, please contact our attorneys Barbara Podell, Esq. at (215) 875-4690 or Andrew Abramowitz, Esq. at (215) 875-3015, or fill out the form on this page.
According to the lawsuit, GSX and its senior management failed to disclose to investors that the Company had overstated its profitability, revenue, student enrollment figures, teacher qualifications, and teacher selection process. The truth first came to light on February 25, 2020, when Grizzly Research published a report that alleged, among other issues, that the Company “has been drastically overstating its profitability,” that it had used “essentially fake student enrollments to boost student count,” and that “many of GSX’s reported students do not actually exist.”
On this news, the price of GSX’s ADSs fell $1.33, or 2.93%, from $45.42 per share on February 24, 2020 to $44.09 per share on February 25, 2020.
Then, on April 14, 2020, Citron Research published a report highlighting additional alleged issues with GSX’s business and finances, including that the Company’s 2019 revenue was overstated by 70%, that its “sales revenues are largely exaggerated,” and that the Company’s “filings are riddled with suspicious transactions.” On this news, the Company’s ADSs declined further.
If you purchased GSX ADSs during the Class Period, you may seek Court appointment as lead plaintiff to represent other injured investors in a class action. The lead plaintiff appointment deadline is June 16, 2020. You do not need to be a lead plaintiff to share in any potential Class recovery.
Whistleblowers: Persons with non-public information regarding GSX Techedu Inc. should consider their options to help Berger Montague’s investigation or take advantage of the SEC Whistleblower program. Under this program, whistleblowers who provide original information may receive rewards totaling up to thirty percent (30%) of successful recoveries obtained by the SEC. For more information, contact us.
Berger Montague, with offices in Philadelphia, Minneapolis, Washington, D.C., and San Diego, has been a pioneer in securities class action litigation since its founding in 1970. Berger Montague has represented individual and institutional investors for five decades and serves as lead counsel in courts throughout the United States.
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