Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Eastern District of Missouri, St. Louis Division, on behalf of all purchasers of securities of Panera Bread Co. (NASDAQ:PNRA) ("Panera" or the "Company") between November 1, 2005 and July 26, 2006, inclusive (the "Class Period").
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin Barroway Topaz & Kessler, LLP (Darren J. Check, Esq. or Richard A. Maniskas, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at firstname.lastname@example.org.
The Complaint charges Panera and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Panera owns and franchises bakery-cafes under the Panera Bread and Saint Louis Bread Co. names.
The Complaint alleges that, throughout the Class Period, defendants failed to disclose material adverse facts about the Company's financial well-being, business relationships, and prospects. Specifically, defendants failed to disclose or indicate the following: (1) that the Company was experiencing fierce competition from similar dining establishments, such that the Company would not be able to maintain growth and earnings trends and projections, (2) that the Company's strategy of rapidly expanding locations was causing a decline in sales per restaurant and a lower return on capital because business was being drawn away from existing stores, (3) that the Company's business was trending negatively because of both slow growth and rising expenses, and (4) that, as a result of the foregoing, the Company's statements about its financial well-being and future business prospects were lacking in any reasonable basis when made.
On July 17, 2006, Barron's published an article which detailed some of the financial difficulties Panera was facing. Specifically, the article discussed increased competition, as well as existing Panera stores losing customers to new Panera locations that were being opened at a rapid pace. Panera's same- store sales gains had declined in recent months, bottoming out in the low single digits from a high of 10.2%. The Company's revenue and earnings per share were rising, but the return on capital was declining, resulting in a decline in shareholder value. In response to this news, the Company's shares declined over the next two days. The shares declined $1.39 per share, or 2.24 percent, to close on July 17, 2006 at $60.71 per share, on unusually heavy trading volume. The following day the Company's shares declined an additional $1.30, or 2.14 percent, to close on July 18, 2006 at $59.41, on unusually heavy trading volume.
Then on July 26, 2006, the Company shocked investors when it announced its second quarter financial results, and stated that its projected results for the period were below trend (approximately three percentage points below second quarter two-year comps). The Company further indicated that sales for the second half of the year were uncertain and would be influenced by a new pizza product the Company recently introduced. Moreover, the Company indicated that it had incurred higher startup expenses than in previous quarters, partly due to the introduction of the new product. Upon the release of this news, the Company's shares declined an additional $7.34 per share, or 12.38 percent, to close on July 26, 2006 at $51.93 per share, on unusually heavy trading volume.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin Barroway Topaz & Kessler which prosecutes class actions in both state and federal courts throughout the country. Schiffrin Barroway Topaz & Kessler is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world.
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