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Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against CTO Realty Growth, Inc. (CTO)

1. Securities class action lawsuit filed against CTO Realty Growth, Inc. 2. Allegations of misleading statements and unsustainable practices affecting dividends. 3. Wolfpack Research report predicts imminent further dilution of CTO shares. 4. CTO has insufficient cash flow to meet dividend and capital expenditure needs. 5. CTO stock price dropped 5.42% following the news on June 25, 2025.

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FAQ

Why Very Bearish?

The lawsuit and critical report may significantly undermine investor confidence, historically evident in similar cases leading to long-term declines.

How important is it?

The legal proceedings suggest serious financial issues, which strongly affect stock price perceptions.

Why Short Term?

Immediate market reactions are expected due to negative news, with potential longer-term considerations depending on lawsuit outcomes.

Related Companies

B. Riley Financial, Inc. (RILY)
NEW YORK, Aug. 11, 2025 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Middle District of Florida on behalf of all persons or entities who purchased or otherwise acquired CTO Realty Growth, Inc (“CTO” or the “Company”) (NYSE: CTO) securities between February 18, 2021 and June 24, 2025, inclusive (the “Class Period”). The Complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose that: (i) CTO’s dividends were less sustainable than Defendants had led investors to believe; (ii) the Company used deceptive and unsustainable practices to artificially inflate its AFFO and overstate the true profitability of its Ashford Lane property; (iii) accordingly, CTO’s business and/or financial prospects were overstated; and (iv) as a result, Defendants' public statements were materially false and misleading at all relevant times. The Complaint also alleges that on June 25, 2025, Wolfpack Research (“Wolfpack”) published a report entitled CTO: The B. Riley of REITs (the “Report”), which compared CTO unfavorably to B. Riley, a financial services company that recently lost more than 90% of its value amid three years of losses, soured investments, delayed financial reports and revelations that the SEC had been investigating whether the firm gave shareholders an accurate picture of its health. In addition, the Complaint alleges that citing interviews with former employees and whistleblowers, the Report accused CTO of, among other things, “not generat[ing] enough cash to pay its recurring capex and cover its dividends since converting to a REIT in 2021” and instead “rel[ying] on dilution (increasing shares outstanding by 70% since December 2022) to cover a $38 million dividend shortfall from 2021 to 2024,” employing a “manipulative definition of [AFFO] where they exclude recurring capex, unlike all of their self-identified shopping center REIT peers,” and “us[ing] a sham loan to hide the collapse of a top tenant from shareholders at Ashford Lane.” Further, the Complaint alleges that Wolfpack predicted imminent further dilution of the Company, noting that CTO has just $8.4 million in cash while facing quarterly dividends of $14 million and average recurring capital expenditures of $5.7 million per quarter, along with approximately $12 million in additional planned capital expenditures. On this news, the Company’s stock price fell $0.98 per share, or 5.42%, to close at $17.10 per share on June 25, 2025. Investors who purchased or otherwise acquired shares of CTO should contact the Firm prior to the October 7, 2025 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.  If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com. Please visit our website at http://www.gme-law.com for more information about the firm.

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