Sunlight Financial Holdings Inc.

Ticker: SUNL

Class Period Start: 01/25/2021

Class Period End: 09/28/2022

Registration Deadline: 02/14/2023

A securities class action has been filed in the USDC – S.D.N.Y. against Sunlight Financial Holdings Inc. (SUNL) on behalf of persons and entities that purchased or otherwise acquired Sunlight securities between January 25, 2021 through September 28, 2022.

On September 28, 2022, Sunlight issued a press release “announc[ing] that an installer liquidity event and volatile interest rates will impact its full-year 2022 financial performance” and that “[a]s a result, the Company is withdrawing its previously-provided full-year 2022 outlook metrics.” Sunlight stated that “[o]ne of Sunlight’s largest solar installers has notified the Company that due to cash flow challenges, the installer is in the process of winding down its operations, likely restricting its ability to fully meet its financial obligations. As a result, Sunlight expects to impair $30 to $33 million in advances to that installer on the Company’s balance sheet as of September 30, 2022.”

After the Company’s disclosure on September 29, 2022, stock price fell $1.44 per share, or 57.1%, to close at $1.08 per share.

The Complaint alleges throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, defendants failed to disclose to investors:

  • that the Company lacked effective underwriting and risk evaluation with respect to its contractor advance program;
  • that Sunlight lacked the oversight and periodic monitoring systems necessary to timely detect bad debt associated with its contractor advance program;
  • that Sunlight lacked effective internal controls over accounting and reporting of non-cash advance receivables;
  • that, as a result, the Company would be forced to take a non-cash advance receivables impairment charge exceeding $30 million; and
  • that, as a result of the foregoing, Defendant’s positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

After the Company’s disclosure on September 29, 2022, stock price fell $1.44 per share, or 57.1%, to close at $1.08 per share.

 

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