Big Short Update: Contrarian Conference Highlights
by Ivano Celia, on Aug 21, 2020 1:44:00 PM
The past two years, I started to experiment with short selling trading positions. There have been some ups... a few downs... but altogether its been a wild and exiting ride! Ultimately, I realized that my biggest struggle with short selling was getting the timing right. If the main stream news is covering the short, then you've already missed the opportunity. So, if I wanted to get in on the Big Shorts alongside the top players, I would need to get ahead of the mass release of information. That's why, when I found out about the 3rd Contrarian Investor Virtual Conference on August 11th, I jumped at the opportunity to attend in an attempt to join the secretive, elite inner circle of short selling.
The format of the virtual conference included six presentations, four of which were short trading ideas and two of which were long calls on individual stocks. Each presentation was filled with data, facts and detailed company information. Here's a selection of highlights from the virtual event's biggest takeaways.
Courtesy of Breakout Point
Trupanion Inc. (NASDAQ:TRUP)
First up, was Bradley Safalow of PAA Research with a powerhouse presentation on Trupanion Inc., a Seattle-based pet insurance provider. As Safalow walked through the facts on why he believes the stock will trade below $10 a share, TRUP dropped from $68 a share to less than $64. And since then, the stock is down 11.5%. Safalow even went as far as to say "this may be the best short idea I've come across in my career".
The facts he presented were sharp and concise, including Trupanion's lack of brand presence, rising competition, and accelerating market share losses! Despite being a big COVID-19 "winner", Safalow sees that none of TRUP's recent gains are sustainable. Here is a link to the full Trupanion Inc short selling presentation.
STARR Surgical (NASDAQ: STAA)
The second highlight came from Anne Stevenson-Yang of J Capital. Her short selling idea targets STARR Surgical, a California-based manufacturer of implantable contact lenses. Stevenson-Yang started her presentation with a bombshell, saying that despite its value of $3.2 billion, "we think that STARR China's sales are overstated by at least a third". This means that none of the profit actually exists! The in-depth research went on to show evidence that two of the distributors appear to be empty shell companies. Also interesting, was the misalignment of data from Swiss trade exports to China vs. STARR's reported sales in China.
Remark Holdings (NASDAQ: MARK)
By far, the most exciting, and wildly entertaining presentation came at the end of the virtual event, by Dan David of Wolfpack Research. His short selling idea focused on Remark Holdings, a Las Vegas-based tech company, which he claimed to have pumped its market share price.
The research showed several red flags including, among others, the CEO's debt with Las Vegas Casinos. The drama escalated when MARK commented on Wolfpack's presentation calling the research "misleading and sloppy". The battle continued on Twitter when Dave Portnoy accused Dan David of wanting "America to go broke". Watch the full presentation by Wolfpack Research below, although viewer discretion is advised due to mature language.
The 3rd Contrarian Virtual Conference was eye-opening and thrilling, sparking a whole new fascination for me with short selling opportunities! For a more detailed breakdown of the conference highlights, read this analysis summary by Breakout Point. And, if you are interested in getting in on the live action, the next Contrarian Virtual Conference will take place in Q4. In the meantime, you can test out short selling data analytics for yourself, by entering to win a free short selling alerts subscription.
* Note: Presented data and analytics is as of available on 2020-08-15, UTC 12:00.
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