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

Core Viewpoint - A securities class action lawsuit has been filed against CTO Realty Growth, Inc, alleging misleading statements regarding the sustainability of dividends and the true profitability of its properties, particularly Ashford Lane [1][2]. Group 1: Allegations and Financial Practices - The lawsuit claims that CTO's dividends were less sustainable than previously communicated to investors [2]. - It is alleged that the company used deceptive practices to inflate its Adjusted Funds from Operations (AFFO) and overstate profitability [2]. - The complaint highlights that CTO has relied on increasing shares outstanding by 70% since December 2022 to cover a $38 million dividend shortfall from 2021 to 2024 [3]. Group 2: Impact of Wolfpack Research Report - On June 25, 2025, Wolfpack Research published a report that compared CTO unfavorably to B. Riley, indicating serious financial issues [3]. - The report accused CTO of not generating enough cash to cover recurring capital expenditures and dividends since its conversion to a REIT in 2021 [3]. - Wolfpack predicted imminent further dilution for CTO, noting the company had only $8.4 million in cash while facing quarterly dividends of $14 million and average recurring capital expenditures of $5.7 million [3]. Group 3: Market Reaction - Following the publication of the Wolfpack report, CTO's stock price fell by $0.98 per share, or 5.42%, closing at $17.10 per share on June 25, 2025 [4].