Campbell Soup Company (CPB) Misled Investors Regarding Its Business Prospects

According to the complaint, on August 31, 2017, Campbell touted its financial results and business prospects, stating that the company expected the Campbell Fresh division to "return to profitable growth in fiscal 2018." However, on November 21, 2017, Campbell announced disappointing first quarter 2018 financial results, including an operating loss of $6 million, and reduced its fiscal year 2018 guidance for EBIT growth. Nevertheless, defendants reassured investors, stating that the company "continued to expect Campbell Fresh to return to profitable growth this fiscal year." Campbell did not fare much better in the coming months and reported disappointing financial results for the second and third quarters of 2018. Then, on May 18, 2018, the company finally revealed that the Campbell Fresh division was not profitable for the first nine months of fiscal 2018, having incurred a $19 million loss in the third quarter fiscal 2018. The company also announced that its Chief Executive Officer was stepping down immediately. On this news, Campbell shares fell over 12%, to close at $34.37 per share on May 18, 2018.

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