Corporate Investigations
Pomerantz LLP investigates five companies, including Oxford and Zscaler, amid investor fraud claims and significant stock drops.
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Key Points
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Oxford Industries slashed its FY2026 revenue guidance midpoint to $1.49 billion and projected Q2 sales about 5.8% below consensus, with the stock dropping 17.01% to $35.92 after the news.
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Gildan Activewear saw its shares fall 18.7% to $50.34 after Jehoshaphat Research published a short report alleging years of negative organic growth and that the company used financial engineering to mask the decline.
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Wealthfront’s June 4, 2026 results showed total net deposits down 69% year-over-year to $554 million, with margins pressured by startup expenses tied to Wealthfront Home Lending; the company previously IPO’d in December 2025 at $14 per share.
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Zscaler guided for current-quarter revenue of $875–$878 million after May 26, 2026 results, missing consensus of $879 million, which contributed to a 31.52% drop in the stock to $126.41.
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Compass faces a New York Attorney General antitrust probe into market share concerns stemming from its $1.6 billion acquisition of Anywhere Real Estate, with the stock falling 11.82% to $7.61 after the report.
Securities law firm Pomerantz LLP has launched investigations into five companies — Oxford Industries, Gildan Activewear, Wealthfront, Zscaler, and Compass — over potential securities fraud and unlawful business practices. The probes follow a string of damaging disclosures that erased billions in shareholder value across retail, fintech, cybersecurity, and real estate.
The five cases share a common thread: investors say they were misled by overly rosy guidance or undisclosed risks. Oxford stock fell 17.01% to $35.92 after a brutal revenue warning. Gildan dropped 18.7% to $50.34 after a short-seller exposed alleged accounting tricks. Zscaler plunged 31.52% to $126.41 on a guidance miss. Compass fell 11.82% to $7.61 after an antitrust probe surfaced. And Wealthfront, which IPO'd at $14 in December 2025, revealed a 69% collapse in net deposits.
Oxford and Gildan Hit Hard by Revenue Shocks
Oxford Industries, the parent of Tommy Bahama and Lily Pulitzer, slashed its FY2026 revenue guidance midpoint to $1.49 billion. It also warned that Q2 sales would land roughly 5.8% below what analysts expected. Pomerantz is investigating whether leadership knew about the consumer slowdown earlier but kept its public forecasts optimistic.
Gildan's trouble came from outside the company. Activist short-seller Jehoshaphat Research published a report alleging that Gildan had "used a decade of acquisitions and accounting maneuvers to mask a business that has been in structural organic decline for years." The stock shed nearly a fifth of its value in a single session. Pomerantz is now examining whether Gildan's financial disclosures hid negative organic growth from investors.
Wealthfront's Post-IPO Deposit Collapse Draws Scrutiny
Wealthfront went public in December 2025 at $14 per share, pitching its new home lending arm as a key growth driver. But its June 4, 2026 results told a different story. Total net deposits fell 69% year over year to just $554 million. Startup costs tied to Wealthfront Home Lending also squeezed margins harder than expected.
Financial Times reported that the IPO prospectus may have overpromised on the scalability of the lending business. Pomerantz is now probing whether those projections had a fair basis in fact. The investigation could expose what management knew about deposit trends before the public offering.
Zscaler's $4 Million Guidance Miss Triggers a 31% Crash
On May 26, 2026, Zscaler guided for current-quarter revenue of $875 to $878 million. That missed Wall Street's consensus of $879 million by as little as $1 million. The reaction was brutal. The stock fell 31.52% to $126.41, wiping out a massive chunk of its market value. CEO Jay Chaudhry insisted Zscaler remains "the essential platform for the zero-trust era," but the market focused on the gap.
Bloomberg noted that the extreme sell-off reflects how little room for error growth investors now give cybersecurity stocks. Pomerantz's investigation centers on whether Zscaler's earlier projections were reasonably grounded or deliberately inflated to support a high stock price.
Compass Faces New York Antitrust Probe Over Anywhere Deal
Compass paid $1.6 billion to acquire Anywhere Real Estate, and that deal is now drawing fire from the New York Attorney General. The AG's office is probing whether the merger gave Compass a monopolistic footprint in certain markets, potentially pushing up commissions for home buyers and sellers. CEO Robert Reffkin had called the acquisition "a transformative step for the industry."
Wall Street Journal reported the probe sent Compass stock down 11.82% to $7.61. Unlike the other four cases, Compass faces a regulatory threat — not just a market miss. Legal analysts say the AG could seek forced divestitures or even an unwinding of the merger if anticompetitive harm is proven.
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