Investigation of Tufin Software Technologies Ltd.
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Tufin Software Technologies Ltd. (TUFN) Accused of Inflating its IPO Price
Tufin held its IPO on April 11, 2019, offering 7.7 million shares at $14.00 per share and raising approximately $107.8 million in gross proceeds. In Tufin’s offering documents, the Company lauded increased revenues from the Americas of $48.27 million for 2018, primarily in the United States, and touted strong customer relationships and technology products as part of its growth strategy. Under these pretenses, Tufin held its SPO on December 5, 2019, issuing an additional 4,279,882 shares at $17 per share for $72,757,994 in gross proceeds. Despite these positive representations, on January 8, 2020, Tufin announced that it expected to report total revenue in the range of $29.5 million to $30.1 million, compared to its previous guidance of total revenue in the range of $34.0 million to $38.0 million. Tufin also revealed anticipated non-GAAP operating loss in the range of $1.1 million to $2.6 million compared to its previous guidance of non-GAAP operating profit of up to $3 million, citing Tufin’s inability to close a number of transactions, primarily in North America. Following this news, Tufin’s stock fell 24% and its market capitalization declined $145 million. Since then, Tufin’s shares have continued to trade well below its IPO price of $14 per share and SPO price of $17 per share.