Driven Brands Faces Class Action Lawsuit Over Accounting Errors

Written by Emily J. Thompson, Senior Investment Analyst

Source: PRnewswire

Updated: Mar 20 2026

0mins

DRVN-3.41%

Should l Buy DRVN?

Source: PRnewswire

Financial Transparency Crisis: Driven Brands Holdings Inc. faces allegations of significant accounting errors in its financial statements for the past two years, leading to a loss of investor confidence and potential sharp declines in stock price.
Class Action Initiated: Hagens Berman has filed a class action lawsuit in the U.S. District Court for the Southern District of New York, seeking to recover losses for investors who purchased shares between May 9, 2023, and February 24, 2026, highlighting serious concerns over corporate governance.
Regulatory Compliance Risks: The lawsuit alleges that executives violated federal securities laws, reflecting a fundamental failure in financial oversight and transparency, which could result in stricter regulatory scrutiny and legal repercussions.
Whistleblower Program Incentives: The company encourages individuals with non-public information to utilize the SEC Whistleblower program, where whistleblowers may receive up to 30% of any successful recovery, increasing focus on internal issues within the company.

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Analyst Views on DRVN

Wall Street analysts forecast DRVN stock price to rise

8 Analyst Rating

7 Buy

1 Hold

0 Sell

Strong Buy

Current: 12.170

Low

17.00

Averages

21.14

High

24.00

Current: 12.170

Low

17.00

Averages

21.14

High

24.00

Freedom Capital

Dmitriy Pozdnyakov

initiated

$21.80

2026-03-23

Reason

Freedom Capital

Dmitriy Pozdnyakov

Price Target

$21.80

AI Analysis

2026-03-23

initiated

Reason

Freedom Capital analyst Dmitriy Pozdnyakov initiated coverage of Driven Brands with a Buy rating and $21.80 price target. The firm says Driven is the largest automotive services company in North America. It believes the company's portfolio following the sale of the car wash network will bring "structurally higher" margins and a lower leverage profile.

Piper Sandler

Overweight -> Neutral

downgrade

$19 -> $12

2026-02-26

Reason

Piper Sandler

Price Target

$19 -> $12

2026-02-26

downgrade

Overweight -> Neutral

Reason

As previously reported, Piper Sandler downgraded Driven Brands to Neutral from Overweight with a price target of $12, down from $19, following an 8-K filing announcing a substantial number of material errors in the company's reported results over the last three years. While the firm doesn't like downgrading stocks with an over 30% selloff in a single day, Piper says it can't recommend shares at this level for several reasons. First, this represents the second over 30% one-day selloff in less than years. Second, there have been yellow flags in reported numbers including an unrelenting amount of EBITDA adjustments. Finally, overall fundamentals are a bit sluggish, the firm adds.

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About DRVN

Driven Brands Holdings Inc. is an automotive services company in North America, providing a range of consumer and commercial automotive services, including paint, collision, glass, vehicle repair, oil change and maintenance. The Company's segments include Take 5 and Franchise Brands. The Take 5 segment is primarily composed of the Company and franchise-operated Take 5 Oil Change business. The Franchise Brands segment is primarily composed of its portfolio of franchise brands, which include CARSTAR, Meineke Car Care Centers, Maaco and 1-800-Radiator & A/C, along with other smaller brands and services for both retail and commercial customers such as commercial fleet operators and insurance carriers. Its AutoGlassNow businesses provide glass replacement and calibration services to commercial, retail and insurance customers. Its subsidiaries include All Star Glass, LLC, AGN Glass, LLC, Carstar Canada GP Corp, Boing US Holdco, Inc, and others.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

Driven Brands Faces Class Action Lawsuit for Securities Violations

50 minutes agoGlobenewswire

Class Action Reminder: The Schall Law Firm alerts investors that Driven Brands is facing a class action lawsuit for violations of §§10(b) and 20(a) of the Securities Exchange Act, concerning securities purchased between May 9, 2023, and February 24, 2026, with a deadline to contact the firm by May 8, 2026.
Financial Misstatement Disclosure: The complaint alleges that Driven Brands made errors in lease accounting affecting its right of use assets and liabilities, leading to overstatements of revenue and cash, and understatements of selling, general, and administrative expenses for fiscal years 2023 and 2024.
Market Reaction Impact: As the market learned the truth about Driven Brands' financial condition, investors suffered damages, indicating that the company's public statements were materially misleading throughout the class period, potentially eroding investor confidence.
Legal Consultation Opportunity: The Schall Law Firm offers free consultations and encourages affected shareholders to join the lawsuit to seek compensation, demonstrating a commitment to protecting investor rights.

Driven Brands Faces Securities Fraud Allegations Amid 40% Stock Drop

4 hours agoPRnewswire

Securities Fraud Lawsuit: Driven Brands is facing a class action lawsuit filed by Bleichmar Fonti & Auld LLP for issuing materially false financial statements and failing to maintain effective internal controls, with a deadline for investors to join the case set for May 8, 2026, highlighting significant governance failures within the company.
Stock Price Plunge: Following the announcement on February 25, 2026, that it would restate financial statements for fiscal years 2023 and 2024, Driven Brands' stock plummeted from $16.61 to $9.99 per share, a nearly 40% decline, reflecting severe market concerns regarding the company's financial health.
Disclosure of Accounting Errors: Despite assurances of accurate financial reporting, the company revealed pervasive accounting errors, including lease accounting issues and unreconciled cash balances, indicating major deficiencies in internal controls that have undermined investor confidence.
Legal Implications: Investors in Driven Brands may have legal options available, with BFA offering contingency fee representation at no cost, underscoring the financial risks and potential liabilities the company faces in ongoing litigation.

Driven Brands Class Action Reminder

12 hours agoPRnewswire

Class Action Notice: Rosen Law Firm reminds investors who purchased Driven Brands stock between May 9, 2023, and February 24, 2026, that they must apply to be lead plaintiff by May 8, 2026, to participate in the class action and seek compensation.
Fee Arrangement: Participants are not required to pay any upfront fees or costs, as the law firm will handle the case through a contingency fee arrangement, reducing the financial burden on investors and encouraging more affected shareholders to join the lawsuit.
Lawsuit Background: The lawsuit alleges that Driven Brands issued false and misleading financial reports from 2023 to 2025, resulting in investors suffering losses due to overstated revenues and cash in 2023 and 2024, alongside understated operating expenses.
Law Firm Credentials: Rosen Law Firm specializes in securities class actions and has recovered over $438 million for investors in 2019 alone, demonstrating its extensive experience and success in handling such cases, prompting investors to carefully select qualified legal counsel.