PPDAI Faces Shareholder Lawsuits over Alleged Violations; Stock Plunges 8%
The stock of PPDAI dropped 8 percent Thursday after several law firms launched investigations into the Chinese P2P lender on behalf of shareholders.
The stock of PPDAI Group Inc. (NYSE: PPDF) plunged 8 percent Thursday after a number of law firms initiated investigations into possible violation of federal security laws by the Chinese lending company's officers and directors.
Scott+Scott Attorneys at Law LLP, Robbins Arroyo LLP, and Levi & Korsinsky LLP were among the firms seen in relation to the name PPDAI, a peer-to-peer Shanghai lender. The shareholder and consumer rights litigation firms are calling for investors who acquired PPDAI's stock after its initial public offering in November to join a suit against the company.
The allegations were that some of PPDAI's filings with the U.S. Securities and Exchange Commission reported misleading or incomplete information regarding the company's business practices, interest rates on loans, or the quality of loans it has issued.
PPDAI reported revenue of $160.2 million for the second quarter of 2018, nearly level compared with a year ago. The firm's net income was $91.7 million, down 4 percent from the second quarter of 2017. Earnings per share were 28 cents in contrast to a loss of 14 cents per share a year ago.
The stock of PPDAI closed at $6.22 per American depositary share Thursday, down 54 cents on the day.
Shares in PPDAI dropped 8 percent to $6.22 per share after several law firms launched investigations into the company on behalf of shareholders.