The Bear Cave #295

New Activist Reports, Recent Resignations, and Tweets of the Week

Oct 12, 2025

Welcome to The Bear Cave! Our last premium articles were “Problems at DraftKings (DKNG)” and “More Problems at DraftKings (DKNG)” and our next special investigation comes out this Thursday, October 16.

New Activist Reports

Fuzzy Panda Research published a follow-up report on Red Cat Holdings (NASDAQ: RCAT — $1.55 billion), a drone technology company. Fuzzy Panda alleged management misled investors about the size of an Army contract and, based on data from a FOIA request, suggested the company’s Army contract “is only worth $12.9 million,” well below “the >$30 million or >$55 million that management has promised in the past.” Fuzzy Panda also alleged the company’s new FANG drone relies on technology from other companies and said some of the drone’s technology may be from manufacturers in China.

Fuzzy Panda originally published on Red Cat in August and alleged that the company’s senior engineers “have been quitting for months” and that the company engages in paid stock promotion.

Wolfpack Research published on Datasection (Tokyo: 3905 — 31.8 billion yen), a Japanese data management company. Wolfpack alleged that Tencent “is the company’s sole major customer” and was “behind Datasection’s planned supercluster of restricted NVIDIA B200 GPUs in Japan,” likely in violation of U.S. export controls on the valuable technology. Wolfpack said it “considers the partnership between the company and Tencent to be an utterly dishonorable scandal” and noted the company recently appointed John Ellis Bush Jr., son of former Florida Governor Jeb Bush and grandson of President George H.W. Bush, as a director.

Kerrisdale Capital published on Bitmine Immersion Technologies (NYSE: BMNR — $14.9 billion), a Bitcoin mining company that recently launched an Ethereum digital asset treasury model. Kerrisdale said the model of digital asset treasuries, selling inflated stock to buy cryptocurrency, “is on its way to extinction” as more companies replicate the model and more investors choose to buy cryptocurrency directly. Kerrisdale predicted the company’s ~40% premium to holdings would diminish over time.

Citron Research tweeted critically on Rigetti Computing (NASDAQ: RGTI — $14.2 billion), a quantum computing company, and said Infleqtion, which is merging with the Churchill Capital Corp X SPAC (NASDAQ: CCCX), “remains a far superior quantum company” because it has “real commercial revenue, diversified quantum systems, and a genuine partnership with NVIDIA.”

Recent Resignations

Notable executive departures disclosed in the past week include:

CFO of Korro Bio (NASDAQ: KRRO — $404 million) resigned “to pursue another opportunity” after just seven months.
CEO of NI Holdings (NASDAQ: NODK — $269 million) was terminated without cause after eleven months and also departed the board. The North Dakota-based insurance company is down ~10% since its March 2017 IPO.
CFO of Lanvin Group Holdings (NYSE: LANV — $234 million), “[stepped] down from his position, effective October 27, 2025, to pursue new professional opportunities” after nearly two years. In June 2025, The Bear Cave highlighted the company and wrote:
“Mr. Eric Chan, board member of Lanvin Group Holdings, resigned from the board just six months ‘due to personal reasons.’ Mr. Chan joined the board after stepping down as CEO in January. The Chinese luxury fashion company has had two CEO departures, a CFO departure, and four board departures since its December 2022 SPAC merger. In an August 2024 comment letter, the SEC raised concerns abouts the company’s ‘non-IFRS adjustment for ‘marketing and selling expenses’ in the calculation of contribution profit,’ its financing arrangements with Meritz Securities, and noted that the company’s officer certifications incorrectly ‘exclude the language… regarding responsibilities for establishing and maintaining internal control over financial reporting.’ The company is audited by Grant Thornton Zhitong and is down ~80% since its SPAC merger.”
CFO of Legacy Housing (NASDAQ: LEGH — $529 million) resigned “effective October 10, 2025” due to “a personal decision” after a little over two years. Last week, the company’s CEO also “submitted his resignation, effective October 10, 2025” due to “a personal decision” after a little over three years.
CFO of Freshpet (NASDAQ: FRPT — $2.36 billion) “made the decision to accept an opportunity outside the company” after nearly three years. In July, short-seller Brad Safalow named the company as a top short idea citing the secular headwind from peak pet ownership in the U.S., as well as fewer avenues for growth because the company has saturated its retail channels.
Mr. Jamil Nazarali, board member of Miami International Holdings (NYSE: MIAX — $3.56 billion), resigned after four months “in order to pursue other professional opportunities.” The financial exchange company is up roughly 40% since its August 2025 IPO.

Data for this section is provided by VerityData from VerityPlatform.com

News of the Week

AppLovin Falls Following SEC Investigation

AppLovin (NASDAQ: APP — $193 billion) stock fell ~15% this week following a report from Olivia Solon at Bloomberg that the SEC has been probing the data-collection practices of the adtech company. The investigation “specifically looked into allegations that AppLovin violated platform partners’ service agreements to push more targeted advertising to consumers.” Three weeks ago, The Bear Cave predicted the upcoming story using the SEC FOIA Logs. The Bear Cave wrote:

“New SEC FOIA Logs released this week included AppLovin on the B7A FOIA exemption list, indicating a potential undisclosed SEC investigation. The FOIA request was filed by Olivia Solon at Bloomberg News.”

In February 2025, The Bear Cave also published on AppLovin and alleged the company’s growth “is fueled by low-quality revenue growth from ads that are deceptive, predatory, and at times unreadable or unclickable.” The Bear Cave published a video on how investors can use FOIAsearch.com to know about SEC investigations before reporters break the market-moving news.

“An Exploration of Leveraged ETFs” (Value Zoomer)

“The core finding of this exploration is that the structural flaws in leveraged ETFs—namely volatility decay and significant financing costs—create clear opportunities for investors (especially retail, who are able to apply these strategies in less liquid ETFs with minimal transaction costs). While volatility decay is dependent on market conditions (high volatility, low autocorrelation), the excess tracking error observed in many single-stock leveraged ETFs presents a compelling, more consistent source of alpha.”

“The QUBT Quandry” (Beniamino Green blog)

“Quantum Computing Inc. (NASDAQ: QUBT — $4.26 billion) has soared to a $2.5 billion market cap on the promise of “revolutionary” quantum breakthroughs. A closer look suggests that its technology may be little more than smoke and mirrors. In this report, I unpack how QUBT’s claims diverge from reality and why investors may be badly mispricing the stock…”