Arbor Realty Trust Inc (ABR)
Pitch Summary: The company hid its toxic real estate portfolio using web of real and fake holding companies; $582mil off-balance liabilities is disguised; the company could have been insolvent in case of total portfolio consolidation; major financial ratios are lower than their reported levels BSD Analysis: Arbor Realty has faced scrutiny over its mortgage REIT […]
Hercules Capital Inc (HTGC)
Pitch Summary: Paywalled (Investors view Hercules as a strong and attractive lender in these high-risk sectors, as evidenced by the BDC’s consistent premium to book value, hefty 12% dividend yield, and de minimis loan losses. The Bear Cave believes Hercules’s strength is a mirage.) BSD Analysis: Hercules Capital is a business development company focused on […]
Opendoor Technologies Inc (OPEN)
Pitch Summary: Inherently broken business model (razor-thin margin during strong market, but big losses during down market); unable to increase the capital base – as more capital equals higher cost; losses are expected well into 2024 eroding the remaining equity; more than 75% downside; BSD Analysis: Opendoor pioneered the iBuyer model, using balance sheet capital […]
B Riley Financial Inc (RILY)
Pitch Summary: The company’s audit engagement partner left the company prior to the 10k filing; the company’s $210mil loan to Brian Kahn is double pledged; the auditor is seeking counsel on regulatory matters due to concerns related to RILY; BSD Analysis: Second round of short coverage emphasized valuation opacity and funding fragility. B. Riley effectively […]
Axos Financial Inc (AX)
Pitch Summary: Overvalued (trading with 35% premium to peers); exposed to riskiest asset classes with loose underwriting standards (37% of the CRE loan is in NY); loan book is filled with glaring problems; significant asset quality stress is incoming; Update 6/4/24 – The company published a statement stating the report has a series of inaccurate […]
Globe Life Inc (GL)
Pitch Summary: The company is a subsidiary of AIL. Extremely high number of allegations of kidnapping, assault and child grooming; fraudulent, dishonest and misleading sales tactics; unhealthy financials (high churn, cash flow issues). Update 5/10/24 – A report issued by the Insurance Department that an agent submitted thirteen fraudulent life insurance applications. Update 5/16/24 – […]
Intuit Inc (INTU)
Pitch Summary: Facing fierce competition; overpaid acquisitions (Mailchimp and Credit Karma) that distract the company’s vision; potential anti-consumer behavior; no benefit from the AI despite its claims; accounting distortions; the most overvalued tech company; BSD Analysis: Intuit, the maker of TurboTax, QuickBooks, and Credit Karma, faces a bear case around regulatory and competitive threats, saturation […]
Merchants Bancorp/IN (MBIN)
Pitch Summary: One of the highest concentrations of 411% to CRE market; bridge loan multiplied by x11 in 7 years; using brokered deposits to expand its loan book; 99% of the deposits have less than 1-year maturity; BSD Analysis: Merchants Bancorp lends in multifamily construction and warehouse financing. Bears emphasize CRE exposure, rate sensitivity, and […]
Carvana Co (CVNA)
Pitch Summary: Overvalued (trading x8 times higher multiples); $4.8bil junk-rated net debt; declining business; insiders constantly cashing out; potential insolvency risk; the main purchasing party is scaling back from Jan 2025; unnamed ‘mystery’ buyer quitely emerged; risky subprime loans; sham deals; undisclosed SEC investigation; BSD Analysis: Carvana is an online used-car retailer. Bears argue that […]
