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CGNT.US
id: 595

Cognyte Software (CGNT) Financials Misguiding Case

S.D. New York
Court
1:23-cv-01769
Case number
02 Feb 2021
Class period Start
28 Jun 2022
Class period End
01 May 2023
Lead Plaintiff motion deadline
  • Cognyte Software LTD (CGNT) released its Q1 2022 financial results that badly missed analyst estimates.
  • $CGNT declined 28%, seriously damaging investors.
  • Investors suspect Cognyte & its Leaders of multiple violations.
On June 28, 2022, Cognyte released its Q1 2022 financial results which badly missed analyst estimates across the board. Cognyte’s 1Q22 revenue of $87 million, represented a decline of 25%. Analysts were expecting a decline of 2%.

In response, analysts immediately downgraded the Company’s rating and reduced their price targets. William Blair, for example, downgraded Cognyte and concluded that Cognyte’s “low pipeline conversion” issues were a symptom of a broader problem, stating in the relevant part: Cognyte’s brand has been negatively impacted by increased scrutiny of the cyber intelligence industry and fellow Israel cyber surveillance firm NSO Group. Last fall, the U.S. government blacklisted the NSO Group after a multitude of reports surfaced that its software was being used inappropriately by governments to spy on citizens with dissenting views.

On this news, $CGNT declined 28.66%, seriously damaging investors.

Going back, on December 16, 2021, Meta issued a “Threat Report,” which included the results of its “months-long” investigation into the “surveillance-for-hire industry,” revealing for the first time that Cognyte (along with six private companies) regularly targeted, without their knowledge, journalists, dissidents, critics of authoritarian regimes, families of opposition, and human rights activists around the world, and collected intelligence on these people by manipulating them to reveal information and/or by compromising their devices and accounts, in violation of Facebook’s “multiple community standards and Terms of Service.”

On this news, $CGNT fell 5.11%, before declining another 5.5% the next trading day. By December 22, 2021, Cognyte’s stock had fallen to trade at $15 per share, representing a decline of nearly 21%.

Considering all representations and consequent results, Investors have grounds to suspect that the Company and its Leaders made multiple violations, which in turn led to damages for shareholders.
Case Status
Lead Plaintiff Appointed
Alleged Offence
Misleading Statements
Financial Misrepresentation
Failure to Disclose
Omissions
Suspected Party
Directors
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
28 June 2022
Filing date
01 March 2023
Lead Plaintiff Deadline
01 May 2023
Judge
Hon. Lorna G. Schofield
Collecting participants…

Cognyte Software Ltd

Cognyte Software Ltd. provides an investigative analytics software to governments and enterprises worldwide. Its Actionable Intelligence for a Safer World, an open software designed to help governm...

    Ticker
    CGNT.US
    ISIN
    IL0011691438
    CIK
    1824814
    Sector
    Technology
    Industry
    Software - Infrastructure
    Country
    USA
    Address
    33 Maskit, Herzliya, Israel, 4673333