Zulily's stock over the past year has fallen from a high of $68 per share. It is now trading below $15.
Zulily’s stock has fallen more than 80 percent in the past year. Click on chart for real-time price.

Zulily took it on the chin earlier this week after the Seattle online retailer disappointed Wall Street with a huge earnings miss.

The stock continues to fall, with investors losing confidence in the company. As of this morning, Zulily’s stock is trading around $14.25 — an all-time low and about $8 below its initial public offering price from November 2013. Just 12 months ago, Zulily was soaring, reaching $72.75 per share.

Now, here come the law firms, which are seeing blood in the water.

Mark Vadon
Mark Vadon of Zulily

At least two shareholder rights law firms have launched investigations into Zulily, looking to dig into the circumstances around the earnings miss. Law firm Johnson & Weaver said today that its investigating whether statements about Zulily’s business were “false and misleading.”

Meanwhile, the law firm of Pomerantz said it is launching an investigation into whether Zulily executives “violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.”

Investigations of this sort are rather commonplace when companies stumble or miss earnings. A spokeswoman for Zulily declined to comment on the investigations, or the slumping stock price.

Despite revenues that hit $1.2 billion last year, Zulily is struggling to meet expectations. A stock repurchase program of $250 million also left some industry watchers scratching their heads, an unusual move for a growth company of Zulily’s age.

One of the big reasons for Zulily’s slumping stock price was a projection of 2015 revenue of $1.5 billion to $1.65 billion.  That’s a growth rate of just 25 percent to 37.5 percent, far below the company’s historical growth pattern (revenues grew by 72 percent in 2014).

Of course, it becomes harder for companies to sustain their growth as they get larger, but Wall Street certainly was not thrilled with the projections. That projection, coupled with the earnings miss, has caused many to bail on Zulily.

The company also announced this week that CFO Marc Stolzman is leaving the company early next month.

In a conference call with stock analysts earlier this week. Zulily Chairman Mark Vadon admitted that the business is suffering.

“We have been growing so fast that, at times, we’ve let execution be more wobbly than it should be,” said Vadon, noting that the company plans to fix those issues in 2015.

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