National Beverage Corp (FIZZ) Accused of Making Misleading Statements

According to the filed class action complaint, National Beverage Corp (FIZZ) touted its revenue and asserted that it "utilize two proprietary techniques… create growth never before thought imaginable." These statements were false and misleading because National Beverage failed to disclose that its "proprietary techniques" lacked a verifiable basis – even after being questioned by the U.S. Securities and Exchange Commission. On December 8, 2017, after National Beverage issued a press release announcing its financial and operating results for the period ended October 28, 2017, an analyst at Credit Suisse assigned an "underperform" rating to the company's stock, noting that National Beverage's business was driven "almost entirely" by the success of its LaCroix sparkling water brand, the growth trajectory of which was slowing. That same day, an analysist at Maxim reiterated a "sell" recommendation, noting that company's "numerous weak brands and opaque financial reporting" made its sale "highly unlikely."

The company also flaunted its Code of Ethics, which promoted a positive work environment and prohibited any type of harassment. Violating this stated policy, Nick Caporella, the company's Chairman and Chief Executive Officer, has been sued for engaging in a pattern of sexual misconduct between 2014 and 2016. These revelations have caused a further decline in the company's stock price.

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