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VSTS.US
id: 1621
Vestis ($VSTS) Misleading FY25 Guidance, Lost Business, and Securities Fraud Case
Investors can submit applications for the lead plaintiff role.
S.D. New York
Court1:25-cv-04844
Case number05/02/2024
Class period Start05/06/2025
Class period End08/08/2025
Lead Plaintiff motion deadline- $VSTS investors filed a claim against Vestis Corporation for overstating its growth potential and customer retention improvements while concealing execution failures and flawed forecasting.
- After the company abruptly withdrew its 2025 guidance due to customer losses and margin erosion, $VSTS crashed 37.5% on May 7, 2025.
Case Details:
Between May 2, 2024 and May 6, 2025, Vestis repeatedly told investors it was executing on strategic initiatives to drive customer growth, retention, and margin expansion. Executives claimed that FY25 would bring improved service operations and high-value account wins, projecting full-year revenue growth and strong earnings.
In reality, internal issues were mounting. Vestis was losing existing customers, failing to deliver on service promises, and struggling to execute its strategies. The company did not warn investors that its full-year guidance was based on flawed assumptions and unstable client relationships.
On May 7, 2025, Vestis announced it was withdrawing its FY25 guidance due to lost business and lower volumes from existing customers. It also reported a revenue miss and shrinking margins. $VSTS dropped 37.5% that day, closing at $5.44, down from $8.71. Analysts responded by downgrading the stock and sharply criticized the company’s operational credibility.
Based on these events, $VSTS investors filed a claim against Vestis Corporation, accusing the company of the following:It misled investors about growth, retention, and service improvements.
- It concealed internal failures that undermined its full-year guidance.
- It failed to update investors as key accounts declined and operations faltered.
- It triggered a major stock drop after withdrawing guidance without prior warning.
Considering all the representations, investors believe Vestis misrepresented its business health and misled the market to maintain its valuation.
Case Type
US Securities Class Action
Case Status
Lead Plaintiff Submission
Alleged Offence
Misleading Statements,
Failure to Disclose,
Omissions
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
05/07/2025
Filing date
06/09/2025
Lead Plaintiff Deadline
08/08/2025