Shorts, Values, and Quick Takeaways: Thoughts on the Pre-Conference Workshop

by Travis Johnson, Stock Gumshoe | April 2, 2014 10:09 pm

Takeaways from the start of the Value Investing Congress

This is premium content. To view this article (and to have full access to the rest of our articles), sign up. Already a member? Log in.

Source URL: https://www.stockgumshoe.com/2014/04/shorts-values-and-quick-takeaways-thoughts-on-the-pre-conference-workshop/


8 responses to “Shorts, Values, and Quick Takeaways: Thoughts on the Pre-Conference Workshop”

  1. For what it’s worth, I should also note that QCOR’s marketing practices and the real viability of their drug have been questioned by short sellers for a couple years now, though this latest report about actual testing of the drug from Citron is a big step away from just the “misleading or illegal marketing” accusations that the short sellers largely started with … and those short sellers have lost heavily as the shares have rebounded strongly since the first short seller published critiques that I’ve seen, from about two years ago. The stock has been both a momentum darling and a short seller target for much of the last year, short interest is now up close to 40%. It is really, really hard and expensive to short a very profitable stock that has strong earnings growth, so the short argument really needs the investigations into the company to bear some fruit … and for the FDA to get worried about the active ingredient and the chemical analysis of the drug. I certainly don’t know enough after a few hours of browsing around to tell you whether Citron will be right, but it’s for damn sure that I wouldn’t be long the stock … whether or not I end up betting against it at some point in the future, well, I’ll let you know. Tilson also did say that often the best time to take on a short position is after the company releases some kind of terrible results or an investigation is announced and the stock falls by 40% … but then bounces back as sell-side analysts say the drop is overdone, even though whatever the catalyst is reinforces the thesis that the stock is headed far, far lower. We’ll see if that happens this time around.

    I’m really glad I don’t have to make a living as a short seller.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.