Napco Security Technologies, Inc. (NASDAQ: NSSC)
NEW YORK, NY – September 6, 2023 – Wolf Haldenstein Adler Freeman & Herz LLP (“Wolf Haldenstein”) announces that a federal securities class action lawsuit has been filed in the United States District Court for Eastern District of New York on behalf of persons and entities that purchased or otherwise acquired Napco Security Technologies, Inc. (“Napco” or the “Company”) (NASDAQ: NSSC) securities between November 7, 2022 and August 18, 2023, inclusive (the “Class Period”).
All investors who purchased shares and incurred losses are advised to contact the firm immediately at firstname.lastname@example.org or (800) 575-0735 or (212) 545-4774.
If you have incurred losses, you may, no later than October 30, 2023, request that the Court appoint you lead plaintiff of the proposed class. Please contact Wolf Haldenstein to learn more about your rights.
The filed complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects.
Specifically, Defendants failed to disclose to investors that:
- Napco failed to address any material weaknesses with internal controls regarding cost of goods sold (“COGS”) and inventory;
- Napco downplayed the severity of material weaknesses regarding their internal controls;
- Napco’s unaudited financial statements from September 30, 2022 to the present included
“certain errors” such as overstating inventory and understanding net COGS, resulting in overstated gross profit, operating income and net income for each period;
- as a result, Napco would need to restate its previously filed unaudited financial statements for certain periods; and
- as a result, Defendants’ positive statements about the Company’s business, operations, and
prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
On August 18, 2023, after the market closed, Napco disclosed that its financial statements for fiscal quarters ended September 30, 2022, December 31, 2022 and March 31, 2023 should no longer be relied upon. Napco explained that management “identified certain errors related to the Company’s calculation of cost of goods inventory for each of the first three quarters of fiscal 2023” because the Company’s costing procedures did not appropriately account for component cost fluctuations. As a result, the Company disclosed that it overstated its inventories and understated its COGS, and that it overstated gross profit, operating income and net income in each period.
On this news, Napco’s stock price fell $17.30, or 45%, to close at $21.11 per share on August 21, 2023.
Wolf Haldenstein has extensive experience in the prosecution of securities class actions and derivative litigation in state and federal trial and appellate courts across the country. The firm has attorneys in various practice areas; and offices in New York, Chicago and San Diego. The reputation and expertise of this firm in shareholder and other class litigation has been repeatedly recognized by the courts, which have appointed it to major positions in complex securities multi-district and consolidated litigation.
If you wish to discuss this action or have any questions regarding your rights and interests in this case, please immediately contact Wolf Haldenstein by telephone at (800) 575-0735 or via e-mail at email@example.com.
Wolf Haldenstein Adler Freeman & Herz LLP
Patrick Donovan, Esq.
Gregory Stone, Director of Case and Financial Analysis
Tel: (800) 575-0735 or (212) 545-4774
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Certification and Authorization Pursuant to Federal Securities Laws
Date of signing: 09/27/2023