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HAGENS BERMAN, NATIONAL TRIAL ATTORNEYS, Updates EHTH, GSX, IQ, VMW Investors, Encourages Investors with Losses to Contact Firm, Reminds of Critical Upcoming Deadlines

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SAN FRANCISCO, April 27, 2020 (GLOBE NEWSWIRE) -- Hagens Berman updates investors in the following publicly-traded companies and urges investors who have suffered significant losses to contact the firm. Further details about the cases, including upcoming application deadlines, can be found at the links provided.

EHTH Investors Click Here.
GSX Investors Click Here.
IQ Investors Click Here.
VMW Investors Click Here.

eHealth (EHTH) Securities Class Action:

Class Period: Mar. 19, 2018 – Apr. 7, 2020
Lead Plaintiff Deadline: June 8, 2020
Sign Up: www.hbsslaw.com/investor-fraud/EHTH
Contact An Attorney Now: EHTH@hbsslaw.com
844-916-0895

The complaint alleges that Defendants misrepresented and concealed eHealth’s highly aggressive accounting and modeling assumptions, skyrocketing rate of member churn resulting from the company’s pursuit of low quality, loss-making growth, and its reliance on direct response television advertising which attracts an unprofitable high-churn enrollee.

Investors began to learn the truth, according to the complaint, on Apr. 8, 2020, when Muddy Waters Capital published a scathing report about the company, finding that eHealth uses deceptive accounting to mask a significantly unprofitable business. According to Muddy Waters, eHealth makes “overly optimistic” modeling assumptions concerning its health insurance plan life-time values (LTV), obscures customer churn rates, and materially understates costs. As a result, Muddy Waters claims eHealth has grossly overstated its reported revenues and operating profit by hundreds of millions of dollars.

Moreover, Muddy Waters pointed out that while falsely hyping the company as “the Expedia / Zillow of health insurance,” corporate insiders have sold $35 million of their personally held stock at inflated prices, including CEO Scott Flanders, who sold 15% of his stake in January 2020 alone.

On this news, the stock plummeted $12.82 or approximately 12% in a single trading day.

GSX Techedu (GSX) Securities Class Action:

Class Period: June 6, 2019 - Apr. 13, 2020
Lead Plaintiff Deadline: June 16, 2020
Sign Up: www.hbsslaw.com/investor-fraud/GSX
Contact An Attorney Now: GSX@hbsslaw.com
844-916-0895

The Complaint alleges that throughout the Class Period, Defendants overstated GSX’s profitability, revenue, student enrollment figures, teacher qualifications, and teacher selection process.

Investors began to learn the truth, according to the Complaint, beginning on Feb. 25, 2020 when Grizzly Research published a scathing report, “Brushed Student Counts and Cooked Books: Why We Believe GSX Techedu is the Worst Publicly Traded Education Company.” According to the report: (1) the company “has been drastically overstating its profitability in its US public filings, especially for 2018;” (2) Grizzly “found multiple strong indications of past and current order ‘brushing’” which are “fake student enrollments to boost student count;” (3) “many of GSX’s reported students do not actually exist;” and, (4) “[w]hile [GSX] touts its high-quality teacher recruitment mechanism, [Grizzly] found a website that was not functional, multiple allegations of GSX hiring teachers right out of college, with no prior experience, and fabricated teachers profiles.”

Then, on Apr. 14, 2020, Citron Research published its own cutting report, “GSX Techedu Inc. – The Most Blatant Chinese Stock Fraud Since 2011,” accusing GSX of fabricating up to 70% of its revenues. According to the report, GSX’s Chinese official government financials and SEC financials are irreconcilable and show a 75% overstatement of net profits for FY 2017 – 2018 alone.

These revelations have driven the price of GSX ADSs sharply lower.

iQIYI (IQ) Securities Class Action:

Class Period: Mar. 29, 2018 – Apr. 7, 2020
Lead Plaintiff Deadline: June 15, 2020
Sign Up: www.hbsslaw.com/investor-fraud/IQ
Contact An Attorney Now: IQ@hbsslaw.com
844-916-0895

The complaint alleges that Defendants misrepresented and concealed material facts about iQIYI’s business and financial performance. Specifically, the complaint alleges that Defendants inflated iQIYI’s revenue figures, user numbers and operational expenses to cover up other fraud.

Investors began to learn the truth, according to the complaint, on Apr. 7, 2020, when Wolfpack Research published a scathing report, “iQIYI: The Netflix of China? Good Luckin.” According to Wolfpack, the company was committing fraud well before its 2018 IPO and has continued to do so ever since. Wolfpack estimates that (a) iQIYI inflated its 2019 revenue by 27% - 44%, (b) overstates its user numbers by 42% - 60%, and then (c) inflates its expenses, the prices it pays for content, and other assets and acquisitions in order to burn off fake cash to hide the fraud from its auditors and investors.

In addition, according to Wolfpack “[a]rguably one of the most egregious examples of accounting fraud IQ commits is the inflation of barter revenue” whereby barter sublicensing revenues are determined by internal estimates of the value of traded content, allowing management to unilaterally assign inflated values to the transactions.

This news drove the price of iQIYI ADSs sharply lower during intraday trading on Apr. 7, 2020.

VMware, Inc. (VMW) Securities Class Action:

Class Period: Mar. 30, 2019 - Feb. 27, 2020
Lead Plaintiff Deadline: June 1, 2020
Sign Up: www.hbsslaw.com/investor-fraud/VMW
Contact An Attorney Now: VMW@hbsslaw.com
844-916-0895

The Complaint alleges that Defendants made materially false and misleading statements regarding the Company’s financial performance. Specifically, the Complaint alleges that Defendants falsely represented and concealed that: (i) VMware’s reporting with respect to its backlog of unfilled orders was not in compliance with all relevant accounting and disclosure requirements; (ii) the foregoing subjected the Company to a foreseeable risk of heightened regulatory scrutiny and/or investigation; and (iii) as a result, the Company’s public statements were materially false and misleading at all relevant times

The Complaint alleges that the truth emerged on Feb. 27, 2020, when after the market closed, the Company announced disappointing Q4 results and disclosed that in Dec. 2019 the SEC requested documents and information related to VMware’s backlog and associated accounting and disclosures. Significantly, on the Q4 2019 earnings call, VMware disclosed that its total backlog was only $18 million, down massively from $449 million in the year-ago quarter. This news sent the price of VMware shares sharply lower the next day.

Whistleblowers: Persons with non-public information regarding EHTH, GSX, IQ, and/or VMW should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email EHTH@hbsslaw.com, GSX@hbsslaw.com, IQ@hbsslaw.com, and/or VMW@hbsslaw.com.

About Hagens Berman
Hagens Berman is a national law firm with nine offices in eight cities around the country and eighty attorneys. The firm represents investors, whistleblowers, workers and consumers in complex litigation. More about the firm and its successes is located at hbsslaw.com. For the latest news visit our newsroom or follow us on Twitter at @classactionlaw.

Contact:
Reed Kathrein, 844-916-0895