The Bear Cave #230
New Activist Reports, Recent Resignations, and Tweets of the Week
Welcome to The Bear Cave! Our last premium articles were “Problems at DeFi Technologies (DEFTF)” and “Even More Problems at eXp World Holdings (EXPI)” and our next premium investigation comes out this Thursday, July 18.
New Activist Reports
Culper Research published on Iris Energy (NASDAQ: IREN — $2.30 billion), a company that claims to operate “next-generation data centers.” Culper highlighted that the company’s facilities lack key capabilities found in peer data centers and said Iris is “like a Prius at the Grand Prix.” Culper also wrote,
“Since 2020, IREN has burned $716 million in cash, and funded this charade by diluting investors to seemingly no end – share count has exploded 12x in the past 4 years. We believe IREN is a painfully transparent stock promotion that will unravel as investors realize the company’s [high performance computing] claims are nonsense and IREN remains a cash guzzling machine.”
Keith Dalrymple at DF Research published on Willscot Mobile Mini Holdings (NASDAQ: WSC — $7.24 billion), a mobile office and site storage solution provider. DF Research alleged that the company’s fleet “contains old, decrepit and otherwise unrentable units” and its financial results are inflated by massively underinvesting in CapEx.
Recent Resignations
Notable executive departures disclosed in the past week include:
CFO of The Beachbody Company (NYSE: BODI — $58 million) resigned “to pursue other business opportunities” after two and a half years. The company is down ~98% since its June 2021 SPAC merger.
CFO of Owlet Inc (NYSE: OWLT — $37 million) resigned “to pursue other opportunities” after four years. The company is down ~96% since its July 2021 SPAC merger.
CEO of Helios Technologies (NYSE: HLIO — $1.46 billion) was placed “on a paid leave effective July 1, 2024, immediately as a result of allegations of a potential violation of the Company's Code of Business Conduct and Ethics” after four years. The company also disclosed that “the leave is pending completion of an ongoing investigation being conducted by the Board with the assistance of outside legal counsel. The alleged conduct that prompted this review does not relate to, and does not impact, the company's strategy or financial reporting.”
CEO of LegalZoom.com Inc (NASDAQ: LZ — $1.16 billion) “will be departing the company” after nearly five years and is also leaving the board. In February, the company’s Chief Operating Officer “entered into a separation agreement” after four years and five board members have departed in the last fourteen months. The company is down ~85% since its June 2021 IPO.
CEO of Global Industrial Co (NYSE: GIC — $1.24 billion) resigned “to pursue another opportunity” after five and a half years and also departed the board.
CFO of Chipotle Mexican Grill (NYSE: CMG — $79.2 billion) retired after 23 years. The company is up ~6,750% since its 2002 IPO.
Rachel Haurwitz, Ph.D., board member of Seer Inc (NASDAQ: SEER — $121 million), resigned “effective immediately” after two and a half years. In November 2021, The Bear Cave wrote that Seer “may be more bark than bite” and since then the company has fallen ~95%.
Data for this section is provided by VerityData from VerityPlatform.com
What to Read
“Archegos Founder Bill Hwang Found Guilty on Fraud Charges” (WSJ)
“Hwang, a protégé of hedge-fund titan Julian Robertson, set up Archegos over a decade ago as a low-profile family office that managed his personal wealth. Archegos had most of the trappings of a hedge fund, but because it lacked outside investors, it didn’t have to comply with many hedge-fund regulations and could stay under-the-radar….
Tomita testified that Hwang directed him to manipulate prices of stocks by doing things like trade aggressively in the minutes before the market closed on a given day. Many of Archegos’s trades took the form of swaps, allowing the firm to avoid public reporting of its total positions in individual stocks.”
Tweets of the Week
Until Thursday,
The Bear Cave