š»The Bear Cave #19š»
New Activst Reports, Stock to Watch (PLMR), SEC News, and Tweets of the Week
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New Activist Reports
Marcus Aurelius Research published on health insurance tech company, Benefytt TechnologiesĀ (NASDAQ: BFYT ā $264 million). They pointed to a recent $225 FCC fine against robocallers and wrote,
āFCC documents lead us to conclude that a significant portion of these robocalls were used to generate āleadsā for brokers within BFYTās network to sell policies to unsuspecting consumers.ā
Marcus Aurelius Research has published four (1, 2, 3, 4) prior articles on the company, which was previously called Health Insurance Innovations.
Prescience Point Capital Management published a critical report on Enphase Energy (NASDAQ: ENPH ā $5.85 billion) and opined that over $200 million of its revenue is fabricated. In response to the report Enphase stock fell 24%.
In 2019, J Capital Research also scrutinized Enphaseās accounting. Enphase stock is up around 4,000% since 2017.
Hindenburg Research published on the Chinese lender Wins Finance Holdings (NASDAQ: WINS ā $540 million). Hindenburg called the company an āobvious Pump and Dumpā and āa zero in short order.ā
Alta Fox Capital took an activist long 5.2% stake in Collectors Universe (NASDAQ: CLCT ā $305 million). In addition, Alta Fox nominated six new directors and wrote a thoughtful letter outlining its campaign.
Stock To Watch: Palomar Holdings
Palomar Holdings (NASDAQ: PLMR ā $2.02 billion), a catastrophe insurance company, is up approximately 350% since its April 2019 IPO. Over this same time period, Palomar insiders have sold nearly $15 million in stock and the company has seen four notable departures.
This February, one of Palomarās board members, Geoffrey Miller, resigned. This April, Palomar disclosed that another board member, George Estes III, would retire from the board and not be nominated for reelection. This June, Palomarās chairman, Ryan Clark, announced that his fund had exited its Palomar stake and he would step down.
In addition, the company announced Andy Robinson, Palomarās Chief Risk Officer, would be stepping down as of August 1, 2020.
The company was profiled in a recent Value Investors Club short pitch. Ā
Shares currently trade for 7x book value and 54x profits.
SEC News
AmTrust Financial and former CFO pay $10.5 million (SEC Release)
āAccording to the SECās complaint, AmTrust (OTC: AFSIA ā $2.83 billion) and Pipoly failed to properly disclose the companyās process for reporting managementās best estimate of loss reserves in its filings with the SEC.ā
Argo International pays $900,000 over disclosure issues (Settlement)
āThis matter arises from Argo Group International Holdingās (NYSE: ARGO ā $1.14 billion) failure to disclose⦠that it paid over $5.3 million to its then Chief Executive Officer, President and member of its Board of Directors, Mark E. Watson III, in the form of a wide range of perquisites and personal benefits.ā
Ares Management pays $1,000,000 over illicit trading (Settlement)
Ares Management (NYSE: ARES ā $9.66 billion) entered into a settlement agreement with the SEC because of its failure āto implement and enforce certain of its written policies and procedures⦠to prevent the misuse of potentially material nonpublic information.ā
āSEC Chief Urged to Drop U.S. Attorney Bid Amid Political Battleā (Bloomberg)
āU.S. Securities and Exchange CommissionĀ Chairman Jay Clayton was surprised and dismayed by the political battle that quickly erupted over his pending nomination to be the top federal prosecutor in New York.ā
What to Read
ā20-Year-Old Robinhood Customer Dies By Suicide After Seeing A $730,000 Negative Balanceā (Forbes)
The note found on his computer by his parents on June 12, 2020, asked a simple question. āHow was a 20 year old with no income able to get assigned almost a million dollars worth of leverage?ā
Justice Department Charges Former eBay Staff With āCyberstalking Campaignā (WSJ)
āThe attacks included sending the couple threatening Twitter messages and packages that contained live cockroaches, a funeral wreath and a bloody-pig mask.ā
āShort Sellers Made $2.6 Billion Off Wirecardās Plunge, but Not Without Scarsā (WSJ)
āBefore Wirecard revealedĀ more than $2 billion of cash was missingĀ from its business on Thursday, investors who bet on stocks to decline had made it one of their most popular targets. That set up what may have been one of the biggest paydays for short sellers on a single stock in years.ā
Announcement
Next week The Bear Cave will share our 20 best financial Twitter accounts to follow. Please reply with your favorite accounts and why you like them.
Tweets of the Week











Until next week,
The Bear Cave