Gildan Activewear shares fell over 18% on June 16 after Jehoshaphat Research published a forensic report accusing the company of improper channel stuffing and revenue recognition, wiping out $2.15 billion in market capitalization. The report, based on interviews with former employees, customers, and distributors, alleges that Gildan offered extreme payment terms and incentives to pull forward sales at quarter-ends, including providing product without requiring payment until after resale. National shareholder rights firm Hagens Berman has opened an investigation into whether the allegations are accurate and if Gildan may have violated federal securities laws. The firm is encouraging investors who purchased shares on the NYSE and suffered substantial losses to come forward, as well as whistleblowers with non-public information.
Gildan Activewear Inc.Accused of improper channel stuffing and revenue recognition, with investigation by Hagens Berman for potential securities law violations.