The Bear Cave #255
New Activist Reports, Recent Resignations, and Tweets of the Week
Welcome to The Bear Cave! Our last premium articles were “Our 2024 Hedge Fund Analyst Christmas List” and “Problems at Sezzle (SEZL)” and our next special investigation comes out Thursday, January 16.
New Activist Reports
Hunterbrook Media published an update on Hims & Hers Health (NYSE: HIMS — $5.82 billion), a telehealth platform “focused on providing modern personalized health and wellness experiences to consumers.” Hunterbrook wrote that Hims would suffer once the FDA lifts its “in shortage” label on semaglutide because then Hims could no longer offer compounded versions of the weight loss drug. Hunterbrook predicted that the shortage label “could now be lifted any day” and highlighted that Novo Nordisk has recently resumed Facebook advertising for its two semaglutide drugs, Ozempic and Wegovy.
Hindenburg Research published on Carvana (NYSE: CVNA — $36.8 billion), an online platform for buying and selling used cars. Hindenburg “uncovered $800 million in loan sales to a suspected undisclosed related party” and alleged that Carvana engaged in other related party deals with DriveTime Automotive, a large dealership chain owned by the father of Carvana’s CEO. Hindenburg further alleged that Carvana “is subject to an undisclosed SEC investigation” and called the company “an accounting grift for the ages.”
Carvana stock fell ~20% this week, largely following the Hindenburg report.
In February 2024, Kerrisdale Capital also published an open letter to Carvana’s auditor, Grant Thornton, about its auto financing agreements with DriveTime.
Recent Resignations
Notable executive departures disclosed in the past week include:
CFO of Integral Ad Science (NASDAQ: IAS — $1.74 billion) resigned “to pursue new opportunities” after two years. The company appointed a board member to be “non-employee Interim Chief Financial Officer.” In July 2023, the company’s Chief Accounting Officer also resigned after two and a half years.
Dara Khosrowshahi, board member of Aurora Innovation (NASDAQ: AUR — $11.7 billion), resigned after three years “to reduce his external board commitments and focus on his ongoing responsibilities as CEO of Uber Technologies.” Mr. Khosrowshahi continues to serve on the boards of Grab Holdings, Uber, and Expedia.
Chief Accounting Officer of Advantage Solutions (NASDAQ: ADV — $911 million) resigned after a little over four years “in order to pursue another career opportunity.” The company has had four CEOs and two CFOs in the last three years and is down ~70% since its October 2020 SPAC merger.
Data for this section is provided by VerityData from VerityPlatform.com
News of the Week
“SEC Writes Off $10 Billion in Fines It Can’t Collect” (WSJ)
“‘If we are going to advertise the numbers that we are imposing, we ought to be transparent about the fact that does not mean that money is flowing to the government and to investors,’ said Commissioner Hester Peirce, a Republican member of the SEC.”
Patrol Strike at Vail Resorts
A protest from ski patrollers against Vail Resorts (NYSE: MTN — $6.70 billion) at its Park City Mountain location was branded a “Complete PR Disaster for Vail Resorts” after causing hourlong lines on the ski slopes. Lift Blog, a blog covering the world of ski lifts, tweeted they “have never seen so much negative social media about any ski area ever. The closest thing would be the Stevens Pass meltdown of 2021-22. That was also Vail Resorts.” The labor dispute drew criticism on CNBC and continues to plague the company’s operations.
In March 2022, The Bear Cave published on Vail Resorts and wrote,
“The Bear Cave has uncovered hundreds of complaints that show the Vail Resorts ecosystem is oversold, overworked, and has goodwill stretched thin. Vail’s future may be downhill.”
Noted short-seller Aurelius Value launched a new Substack publication here.
Alta Fox Capital is hosting a national undergraduate stock competition, with prize money and networking opportunities. The submission deadline is February 1, 2025. Learn more here.
Tweets of the Week
Until next week,
The Bear Cave