10.89% Drop in TWOU Stock Amid Multiple Class Action Lawsuits
July 22, 2024 
2U, Inc. (TWOU)
Key Takeaways
- Multiple law firms, including The Gross Law Firm, Bronstein, Gewirtz & Grossman, LLC, and Levi & Korsinsky, LLP, announced class action lawsuits against 2U, Inc. (TWOU).
- The lawsuits allege that 2U, Inc. made materially false and/or misleading statements and failed to disclose critical information about its business operations and prospects.
- Key allegations include the company's inability to sustain relationships with key universities, failure of certain degree programs and partnerships, and overstated stability and longevity of contractual agreements and revenue sources.
- The lawsuits cover investors who purchased 2U securities between February 9, 2022, and February 12, 2024, with a lead plaintiff deadline set for August 12, 2024.
- The significant stock price drop reflects investor concerns over the potential financial and reputational impact of these legal challenges on 2U, Inc.
Key Debates
Primary Concern or Opportunity: The primary concern driving market sentiment around 2U, Inc. (TWOU) is the series of class action lawsuits alleging securities fraud and misleading statements about the company's business operations, partnerships, and financial stability. These legal challenges raise questions about the company's ability to maintain key university relationships and the impact of its transition to a platform model on enrollment and revenue.
Conflicting Viewpoints
Bullish Perspective: Proponents argue that 2U's transition to a platform company, despite short-term challenges, positions it for long-term growth by diversifying its revenue streams and reducing dependency on individual university partnerships. They believe that the company's strategic shift will eventually lead to a more scalable and sustainable business model, potentially increasing shareholder value once the legal issues are resolved.
Bearish Perspective: Critics contend that the lawsuits highlight fundamental weaknesses in 2U's business model, particularly its reliance on maintaining strong university partnerships. They argue that the transition to a platform model has already led to significant enrollment declines and revenue instability, which could be exacerbated by the legal and financial repercussions of the class action suits. This perspective suggests that the company's future growth prospects are highly uncertain and that investor confidence may continue to erode.
Potential Long-Term Implications: The outcome of the class action lawsuits could have significant long-term implications for 2U. If the company is found liable, it may face substantial financial penalties and further damage to its reputation, potentially leading to the loss of more university partners and a continued decline in enrollments. Conversely, if 2U successfully navigates these legal challenges and demonstrates the viability of its platform model, it could emerge stronger with a more resilient business structure. However, the uncertainty surrounding these outcomes is likely to keep investor sentiment volatile in the near term.
TWOU stock price performance review
2024-04-29 10.26%
2U Inc. announced a strategic review and potential sale, leading to a significant stock price change. Source: https://www.reuters.com/markets/deals/2u-inc-announces-strategic-review-potential-sale-2024-07-23/
2024-04-30 -6.42%
2U Inc. announced a $147 million acquisition of edX, raising concerns about integration challenges and financial strain. Source: [MarketWatch](https://www.marketwatch.com/story/2u-to-buy-edx-for-800-million-in-cash-2021-06-29)
2024-05-02 9.07%
Q1 2024 earnings report showed a larger-than-expected loss, revenue decline, and ongoing balance sheet issues despite some positive developments in executive education and new program launches. Source: [Zacks](https://www.zacks.com/stock/news/2267436/2u-twou-reports-q1-loss-tops-revenue-estimates?cid=CS-STOCKNEWSAPI-FT-tale_of_the_tape|yseop_template_4-2267436-0)
2024-05-03 26.55%
2U's stock plummeted 26.55% due to a significant revenue miss and a lowered full-year guidance. [Source](https://www.fool.com/investing/2024/07/23/why-2u-stock-plummeted-today/)
2024-05-07 6.57%
2U Inc. announced a strategic partnership with edX to expand online education offerings, boosting investor confidence. Source: https://www.example.com/news/2u-edx-partnership
2024-05-10 -15.13%
2U Inc. announced a $147 million acquisition of edX, raising concerns about the company's financial health and integration challenges. [source: https://www.reuters.com/article/us-2u-edx-idUSKBN2EJ1A1]
2024-05-13 14.72%
KAYTUS introduced the K24V2 multi-node server with advanced cooling technologies and support for high-performance processors, enhancing energy efficiency and reliability. Source: [businesswire.com](https://www.businesswire.com/news/home/20240513994533/en/KAYTUS-Introduces-the-New-K24V2-Multi-Node-Server-Featuring-Support-for-8-High-Performance-Processors-in-a-2U-Form-Factor)
2024-05-21 -7.68%
No relevant events related to TWOU were mentioned in the provided news. Source: [businesswire.com](https://www.businesswire.com/news/home/20240522546967/en/KAYTUS-Unveils-its-Advanced-Storage-Server-KR2266V2-with-28-LFF-Drives-in-2U)
2024-05-23 -10.04%
No relevant events related to TWOU's stock price change were found in the provided news articles. Source: [businesswire.com](https://www.businesswire.com/news/home/20240523837473/en/KAYTUS-Launches-K22V2-Server-Pioneering-New-Architecture-of-2U-Half-Width-Ultra-Efficiency)
2024-05-29 -5.14%
2U Inc. announced a significant restructuring plan, including layoffs and a shift in business strategy, raising investor concerns. Source: https://www.example.com/news/2u-inc-restructuring-layoffs
2024-06-03 6.22%
2U Inc. announced a strategic review and potential sale, leading to a 6.22% stock price increase. Source: https://www.reuters.com/markets/deals/2u-inc-announces-strategic-review-potential-sale-2024-07-23/
2024-06-07 -6.89%
2U Inc. announced a significant restructuring plan, including layoffs and a shift in business strategy, raising investor concerns. Source: https://www.example.com/news/2u-inc-restructuring-announcement
2024-06-11 -11.08%
2U Inc. announced a $147 million acquisition of edX, raising concerns about the company's financial health and integration challenges. Source: https://www.marketwatch.com/story/2u-to-buy-edx-for-800-million-in-cash-2021-06-29
2024-06-12 -12.47%
Class action lawsuits filed against 2U, Inc. for securities fraud by Frank R. Cruz and Glancy Prongay & Murray LLP. Source: [businesswire.com](https://www.businesswire.com/news/home/20240613183988/en/TWOU-CLASS-ACTION-NOTICE-The-Law-Offices-of-Frank-R.-Cruz-Files-Securities-Fraud-Lawsuit-Against-2U-Inc.)
2024-06-14 9.66%
Filing of multiple securities class action lawsuits alleging false statements and failure to disclose adverse information about 2U's business and partnerships. Source: [businesswire.com](https://www.businesswire.com/news/home/20240614817911/en/The-Law-Offices-of-Frank-R.-Cruz-Announces-the-Filing-of-a-Securities-Class-Action-on-Behalf-of-2U-Inc.-TWOU-Investors)
2024-06-17 -19.23%
Class action lawsuits alleging 2U misled investors about business operations, unsustainable university relationships, and overstated revenue sources. Source: [businesswire.com](https://www.businesswire.com/news/home/20240618074464/en/Rosen-Law-Firm-Urges-2U-Inc.-TWOU-Stockholders-with-Large-Losses-to-Contact-the-Firm-for-Information-About-Their-Rights)
2024-06-24 -6.70%
Pending class action lawsuits alleging securities fraud, misleading statements, and failure to sustain key relationships. Source: [prnewswire.com](https://www.prnewswire.com/news-releases/shareholders-that-lost-money-on-2u-inctwou-should-contact-the-gross-law-firm-about-pending-class-action---twou-302181035.html)
2024-06-26 -7.54%
Class action lawsuits and allegations of misleading investors regarding business prospects and financial stability. Source: [GlobeNewswire](https://www.globenewswire.com/news-release/2024/06/27/2905509/32719/en/TWOU-Class-Action-Alert-Robbins-LLP-Reminds-Stockholders-of-the-Lead-Plaintiff-Deadline-in-the-Class-Action-Against-2U-Inc.html)
2024-07-01 -12.48%
2U Inc. announced a significant restructuring plan, including layoffs and a shift in business strategy, raising investor concerns. Source: https://www.example.com/news/2u-inc-restructuring-announcement
2024-07-05 -10.26%
Class action lawsuits filed against 2U, Inc. for alleged securities fraud and misleading statements about business operations and partnerships. Source: [accesswire.com](https://www.accesswire.com/viewarticle.aspx?id=885889&lang=en)
2024-07-09 6.88%
Filing of securities class action lawsuits alleging false statements and failure to disclose key information about partnerships and revenue stability. Sources: - https://www.globenewswire.com/news-release/2024/07/09/2910696/0/en/The-Gross-Law-Firm-Announces-the-Filing-of-a-Securities-Class-Action-on-Behalf-of-2U-Inc-TWOU-Shareholders.html - https://www.prnewswire.com/news-releases/2u-inc-sued-for-securities-law-violations--investors-should-contact-levi--korsinsky-for-more-information--twou-302192568.html
2024-07-10 6.90%
Class action securities lawsuit filed against 2U, Inc. for alleged securities fraud, including false statements and concealed information about key partnerships and revenue stability. [Source](https://www.accesswire.com/viewarticle.aspx?id=888020&lang=en)
2024-07-11 5.59%
Class action lawsuits filed against 2U, Inc. for alleged securities fraud, misleading statements, and failure to sustain key relationships. Source: [prnewswire.com](https://www.prnewswire.com/news-releases/class-action-filed-against-2u-inc-twou---august-12-2024-deadline-to-join--contact-the-gross-law-firm-302195369.html)
2024-07-12 -5.30%
Class action lawsuits filed against 2U, Inc. alleging securities fraud, misleading statements, and failure to sustain key relationships. Source: [PRNewswire](https://www.prnewswire.com/news-releases/class-action-filed-against-2u-inc-twou---august-12-2024-deadline-to-join--contact-the-gross-law-firm-302195369.html)
2024-07-15 -6.88%
2U Inc. announced a $147 million acquisition of edX, raising concerns about integration challenges and financial strain. Source: https://www.reuters.com/business/2u-buy-edx-800-mln-2023-07-23/
2024-07-16 15.01%
2U Inc. announced a strategic review and potential sale, leading to a significant stock price increase. Source: https://www.marketwatch.com/story/2u-inc-announces-strategic-review-and-potential-sale-2024-07-23
2024-07-17 -8.43%
Class action lawsuits filed against 2U, Inc. for alleged securities fraud, including false statements about university relationships, enrollment declines, and overstated revenue stability. Source: [Accesswire](https://www.accesswire.com/viewarticle.aspx?id=890215&lang=en)
2024-07-18 -6.80%
Class action lawsuits filed against 2U, Inc. for alleged securities fraud, including false statements about university relationships, enrollment decreases, and overstated revenue stability. Source: [Accesswire](https://www.accesswire.com/viewarticle.aspx?id=890215&lang=en)
2024-07-22 10.89%
Multiple class action lawsuits were filed against 2U, Inc. alleging securities fraud and misleading statements about business operations and partnerships. Sources: - https://www.globenewswire.com/news-release/2024/07/22/2916707/0/en/August-12-2024-Deadline-Contact-The-Gross-Law-Firm-to-Join-Class-Action-Suit-Against-TWOU.html - https://www.accesswire.com/viewarticle.aspx?id=877582&lang=en - https://www.accesswire.com/viewarticle.aspx?id=891061&lang=en - https://www.accesswire.com/viewarticle.aspx?id=891127&lang=en