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NEW YORK, Dec. 04, 2021 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized stockholder rights law firm, reminds investors that a class action lawsuit has been filed against StoneCo Ltd. (“StoneCo” or the “Company”) (NASDAQ: STNE) in the United States District Court for the Southern District of New York on behalf of all persons and entities who purchased or otherwise acquired StoneCo securities between May 11, 2021 and November 16, 2021, both dates inclusive (the “Class Period”). Investors have until January 18, 2022 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
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On August 30, 2021, after the market closed, StoneCo announced its second quarter 2021 financial results in a press release, reporting an 8.1% year-over-year decrease in revenue "mainly due to adjustments in credit fair value and significantly lower credit disbursements." The Company stated that it had "implemented some prudent actions, like temporarily stopping the disbursement of credit and increasing coverage for potential future losses, which impacted [StoneCo’s] reported results for the quarter."
On this news, the Company’s share price fell $2.96, to close at $46.54 per share on August 31, 2021, on unusually heavy trading volume.
Then, on October 26, 2021, PAX Global Technology Ltd’s Florida offices were raided by the U.S. Federal Bureau of Investigation, the Department of Homeland Security, and several other agencies as part of a federal investigation. As a Viceroy Research report on October 27, 2021 pointed out, Stone states that PAX "is no longer [its] sole provider of POS services, [but the Company is] still substantially dependent on it to manufacture and assemble a substantial amount of [its] POS devices." Moreover, another company replaced its PAX terminals "because it did not receive satisfactory answers from PAX regarding its POS devices connecting to websites not listed in their supplied documentation."
On this news, the Company’s share price fell $2.64, or 7%, to close at $33.81 per share on October 27, 2021, thereby injuring investors further.
Then, on November 16, 2021, StoneCo announced that it would "start retesting our original [credit] product, which is short-term loans, between the fourth quarter of ’21 and the first quarter of ’22." The Company could not provide specific guidance about when credit volumes would return to levels before StoneCo had halted origination of credit.
On this news, the Company’s share price fell $10.96, or 34%, to close at $20.70 per share on November 17, 2021, thereby injuring investors further.