Leslie's, Inc.

On July 13, 2023, Leslie’s released its preliminary financial results for the third quarter of 2023 and disclosed a sales decline of 12%. The Company claimed that “customer surveys conducted towards the end of the quarter also indicated increased price sensitivity and that consumers entered the pool season with a greater than normal amount of chemicals leftover from last year.” Leslie’s also announced that its Chief Financial Officer was stepping down.

On this news, the Company’s stock price fell $2.82, or 29.6%, to close at $6.70 per share on July 14, 2023, thereby injuring investors.

The complaint filed in this class action 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: (1) the Company’s growth was caused by customers over purchasing products to stockpile in case of a chemical shortage; (2) such sales inflated revenues and earnings and were not indicative of durable and sustainable demand or financial growth; (3) the Company took advantage of chemical shortages by urging customers to stock up on the products because Leslie’s could not “guarantee availability” of chemicals in the future; and (4) any slowdown in sales was not a normalization of past seasonality, but was due to the prior excess stockpiling; and (5) 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.