The Bear Cave #106
New Activist Reports, Recent Resignations, and Tweets of the Week
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New Activist Reports
White Diamond Research published on IronNet Inc (NYSE: IRNT — $542 million), a cyber security company. White Diamond Research alleged the company was benefitting from spurious partnerships and questionable rumors that it would benefit from more cybersecurity spending during the Ukraine war. White Diamond also highlighted the company’s shrinking revenue, consistent losses, and a below-market financing deal with Tumim Stone Capital. The company is down 40% since its August 2021 SPAC merger.
Jehoshaphat Research published a Twitter thread update on BWX Technologies (NYSE: BWXT — $4.53 billion), a supplier of nuclear components and fuel to the U.S. government and commercial nuclear power industry.
Jehoshaphat Research previously criticized the company’s accounting and “27 straight quarters of positive project accounting revisions.”
Viceroy Research published on Samhallsbyggnadsbolaget (Stockholm: SBB — SEK67.1 billion), a Swedish rollup of rent-controlled properties. Viceroy Research said the company was “hard to pronounce, harder to justify value” and alleged “rampant insider dealing, textbook governance problems, and a multitude of financial shenanigans.” For example, Viceroy highlighted that the company’s CEO was previously “detained and investigated by Sweden’s Economic Crimes agency for insider trading.” Viceroy also alleged the company round-trips revenue by paying dividends to tenants and then charging above-market rates. Samhallsbyggnadsbolaget stock is up around 300% over the last five years.
Recent Resignations
Notable executive departures disclosed in the past week include:
CEO of RBB Bancorp (NASDAQ: RBB — $449 million) “will take a leave of absence, effective immediately, pending an internal investigation being conducted by a special committee of the RBB Board of Directors.” Last week, the company’s Chief Lending Officer resigned. RBB Bancorp is audited by Eide Bailly LLP.
CFO of Marrone Bio Innovations (NASDAQ: MBII — $116 million) resigned “for personal reasons” after a little over one year.
CEO of Bath & Body Works Inc (NYSE: BBWI — $14.0 billion) stepped down after two years due to health reasons.
CFO of Citrix Systems (NASDAQ: CTXS — $12.88 billion) resigned after two and a half years. The company has had six different CFOs in the last five years.
CFO of Renew Energy Global PLC (NASDAQ: RNW — $3.13 billion) resigned “to pursue other interests” after a little under three years. The company is down 20% since its August 2021 SPAC merger.
CFO of Fresh Del Monte Produce (NYSE: FDP — $1.25 billion) resigned “to pursue other personal and career interests” after three years.
Chief Accounting Officer of Hillenbrand (NYSE: HI — $3.43 billion) resigned after three weeks because he “accepted a position with another company.”
Executive Chairman of View Inc (NASDAQ: VIEW — $556 million) resigned after four months “as part of the remedial actions recommended by the Audit Committee in connection with its previously disclosed independent investigation.” In November 2021, the company’s CFO resigned because he “negligently failed to properly record the liabilities for warranty-related obligations and cost of revenue.” Jehoshaphat Research previously criticized the company’s accounting, and the stock is now down roughly 75% from its March 2021 SPAC merger.
Chief Accounting Officer of Genuine Parts Company (NYSE: GPC — $17.5 billion) resigned after a little less than one year “in order to pursue a new opportunity.” In January, the company’s CFO announced her resignation as well.
Data for this section is provided by InsiderScore.com
What to Read
“SEC Proposes Rules for More Disclosure From Short Sellers” (WSJ)
“Under the rules proposed Friday, market participants that hold large short positions in stocks would be required to report those positions and related short-sale activity to the SEC monthly. The agency would then aggregate and publish that data for each security, while keeping the identities of money managers and individual short positions confidential.”
“Vladimir Putin, Russia’s resentful leader, takes the world to war” (FT)
“Growing up in a communal apartment in Leningrad, a young Vladimir Putin liked to chase rats across the stairwell with sticks. One day, he spotted a particularly huge rat and drove it into a corner. Suddenly, it threw itself at him, trying to leap onto Putin’s head in its bid to escape. The incident taught Russia’s president a lesson he carried for decades. ‘Everyone should keep this in mind. You should never drive anyone into a corner.’”
Warren Buffett 2021 Annual Letter (Berkshire Hathaway)
“Our policy is to treat all shareholders equally. Therefore, we do not hold discussions with analysts nor large institutions. Whenever possible, also, we release important communications on Saturday mornings in order to maximize the time for shareholders and the media to absorb the news before markets open on Monday.”
Tweets of the Week
Until Thursday,
The Bear Cave