HyreCar, Inc. (HYRE) is the subject of a class action lawsuit filed on behalf of shareholders regarding alleged violations of the federal securities laws.
If you purchased shares of HyreCar between May 14, 2021 and August 10, 2021 (class period), please contact Silver Law Group at (800) 975-4345 or at email@example.com. The deadline to apply to be lead plaintiff (class representative) is October 26, 2021.
HyreCar is a publicly-traded Los Angeles-based company that operates a car sharing marketplace, which allows car owners to rent their cars to drivers for ride-share services like Uber and Lyft.
HyreCar Press Release Causes Stock To Fall
After market close on August 10, 2021, HyreCar stated in a press release that in Q2 2021 the company had net losses of $9.3 million. The company’s adjusted EBITDA loss was $7.1 million, which was more than four times higher than the $1.7 million adjusted EBITDA loss in the same quarter of the previous year.
According to the press release, gross profit for Q2 2021 was $0.8 million, which was less than one third what it was in the same quarter of the previous year.
At the same time the press release was issued, HyreCar filed a 10-Q with the SEC, which disclosed increasing costs of revenue during the quarter, which was attributed to higher insurance claims incidence.
HyreCar had previously represented that its goal was to achieve 45%-50% gross margins, but on an earnings call the CFO called that a “shoot for the sky” aim and suggested lower margins were realistic.
The day after the press release, HyreCar stock dropped in value by almost half, causing significant losses for investors.
The HyreCar class action lawsuit alleges that the company made false, misleading statements during the class period and failed to disclose material information. The class action includes allegations that the company: understated its insurance reserves, failed to pay valid insurance claims, and failed to assess price risk for its insurance products.
Initial Public Offering
HyreCar held its initial public offering (IPO) in 2018 with the offering of 2,520,000 shares of common stock priced at $5 per share. Network 1 Financial Securities, Inc. was the managing underwriter for the offering.
Recover HyreCar, Inc. (HYRE) Investment Losses
Silver Law Group is a nationally-recognized law firm representing victims of securities and investment fraud. Our attorneys represent investors in class action lawsuits against issuers in state and federal court and in arbitration claims in cases of stockbroker misconduct.
Scott Silver, Silver Law Group’s managing partner, is the chairman of the Securities and Financial Fraud Group of the American Association of Justice. Contact us for a no-cost consultation at firstname.lastname@example.org or call (800) 975-4345.