The Five Dumbest Things on Wall Street This Week: July 20
3. Lime Gets Squeezed
Forget the track and field events at the Olympics later this month, the really fast movers are the lawyers chasing class action suits over Lime Energy's (LIME) "non-existent revenue" problem.
The Huntersville, N.C.-based clean energy services provider came clean on Tuesday when it said it misreported revenue on its financial statements during the past two years. Lime's audit committee came to the conclusion "that non-existent revenue may have been recorded" based on the results of a "partial internal review" conducted by the company's management. Shares of Lime fell almost 40% to $1.26 on news of the phantom sales and are now down 75% in the past year.Oh man. If that's what they came up with after a "partial" review, we can't wait to see what they come up with after they finish the job! Of course, by that time the company may be finished as well considering how quickly the class-action lawyers jumped on the case. Seriously, these guys filed cases against Lime faster than you can say Usain Bolt, let alone watch the Jamaican sprinter set a record for the 100 meter dash. Faruqi & Faruqi, LLP. The Rosen Law Firm, P.A. The Law Offices of Todd M. Garber and a number of other class-action lawyers started wooing wronged Lime shareholders almost immediately after the news hit Tuesday. And the field is destined to get more crowded even though the payout -- if there is one -- will most likely be miniscule. For those that may have forgotten, Lime Energy traded as high at $273 a share less than 10 years ago before ultimately crashing with the rest of the so-called green stocks. At the time, most serious investors said the stock's sky-high valuation made no sense. Now the best that some burnt shareholders can hope for is a few cents on the dollar. So what's the lesson here? The quest for Olympic gold comes every four years, but the fools racing for gold on Wall Street never stop running.
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