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id: 597, Created by Stan Vick Chase, Scout
Vertex Energy, Inc. (VTNR) Misconduct Case
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- Vertex Energy (VTNR) disclosed EBITDA for the Mobile refinery of$63.6 million, compared to the guidance of $120-$130 million.
- Vertex Energy (VTNR) stock fell by ~50%, damaging investors.
- Investors suspect Vertex Energy (VTNR) & its Leaders of misleading statements.
On August 9, 2022, Vertex Energy (VTNR) disclosed a net loss of $63.8 million during Q2 2022 and revealed that adjusted EBITDA for the Mobile refinery was only $63.6 million, compared to the guidance given just three months prior for EBITDA of $120-$130 million, a total shortfall of 50%. The Company also withdrew its financial guidance for the remainder of the fiscal year 2022 and fiscal year 2023.
On this news, Vertex Energy stock fell by about 44%, damaging investors. The stock price continued to fall in subsequent days as the market digested the news, reaching a low 50% below the closing price on August 8, 2022.
In early 2021, Vertex Energy announced that it had reached an agreement to acquire an oil refinery located in Mobile, Alabama and a key component of the acquisition was Vertex Energy’s plan to convert a portion of the refinery’s 91,000 barrel-per-day output to renewable diesel fuel, which was expected to generate higher profits than the refinery’s conventional gasoline and diesel fuel outputs.
But taking all appeared facts into account, now Investors have reasons to suspect that, immediately prior to the closing of the Mobile acquisition, the Company had entered into, or was a party to, a series of transactions that dramatically capped the new plant’s profitability and would, in fact, led to significant losses immediately following the acquisition. These transactions, which in some instances were required pursuant to the financing arrangements Vertex Energy had entered into, resulted in over $125 million in losses.
Failure to Disclose,
Breach of Fiduciary duty,
Shock Event Date
08 August 2022
Lead Plaintiff Deadline
12 June 2023