SAN FRANCISCO, Feb. 09, 2024 (GLOBE NEWSWIRE) — Hagens Berman urges Dada Nexus Limited (NASDAQ: DADA) investors who suffered substantial losses to submit your losses now.
Class Period: May 11, 2023 – Jan. 8, 2024
Lead Plaintiff Deadline: Mar. 11, 2024
Contact An Attorney Now: [email protected]
Dada Nexus Limited (DADA) Securities Fraud Class Action:
In a Jan. 9, 2024 report to clients, analysts at JP Morgan commented on Dada’s outlook after its recent admission of improper accounting.
JP Morgan stated, “While the initial media reports suggest the incident was likely due to fraud on the part of individuals instead of a systematic financial fraud across the company or even at its parent JD.com, we believe the case still points to a failure in corporate governance and investors are likely to stay on the sidelines pending an announcement of detailed findings/explanation from an independent review that the company indicated will be conducted.”
The negative analyst sentiment also comes on the heels of a securities fraud class action arising out of the improper accounting.
The complaint there alleges Dada Nexus misrepresented and concealed that: (1) its revenues from online advertising, marketing services, and operations and support costs were materially overstated; and (2) as a result, it would need to conduct an independent review to ascertain the financial impact and the scope of suspicious practices that overstated revenues and costs.
The truth began to emerge on Dec. 19, 2023, when Dada Nexus announced its Chairman of the Board Lijun Xin and CFO Beck Zhaoming Chen would be resigning immediately. The company claimed both Xin’s and Chen’s departures were due to “personal reasons.”
The true explanation for Xin’s and Chen’s abrupt departures became clear on Jan. 8, 2024, when Dada Nexus announced that it had identified “suspicious practices that may cast doubt on certain revenues from the Company’s online advertising and marketing services in 2023.”
The company also said that it “currently estimates that approximately RMB500 million of revenues from online advertising and marketing services and RMB500 million of operations and support costs may have been overstated, respectively, for the first three quarters of 2023.”
In addition, Dada Nexus added, “the revenue guidance previously provided by the Company for the fourth quarter and full year of 2023 should no longer be relied upon[.]”
This news drove the price of Dada Nexus shares crashing $1.445 lower (or down about 45%) on Jan. 8, 2024.
“We are investigating whether Dada Nexus may have intentionally overstated its revenues and understated costs,” said Reed Kathrein, the Hagens Berman partner leading the firm’s investigation.
If you invested in Dada Nexus and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now »
If you’d like more information and answers to frequently asked questions about the Dada Nexus case and our investigation, read more »
Whistleblowers: Persons with non-public information regarding Dada Nexus should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email [email protected].
About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation law firm focusing on corporate accountability through class-action law. The firm is home to a robust securities litigation practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and fraud. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
Past results do not guarantee future outcomes.
Services may be performed by attorneys in any of our offices.
Reed Kathrein, 844-916-0895
Disclaimer: The above press release comes to you under an arrangement with GlobeNewswire. Business Upturn takes no editorial responsibility for the same.