The Bear Cave #74

New Activist Report, Recent Resignations, FINRA Special Notice, Tweets of the Week

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New Activist Report

Spruce Point Capital published a 25,181-word “strong sell opinion” on Oatly (NASDAQ: OTLY — $11.4 billion), a popular oat milk company that went public in May. Spruce Point accused the Sweden-based company of overstating its revenue, citing Nielsen estimates, and said: “gross margins are not reported accurately and consistent with food industry best practices.” In addition, Spruce Point highlighted that Oatly has churned through three auditors in the last six years and the company’s CFO and Audit Chair both did not disclose their roles at prior corporate accounting scandals.

The report received considerable media attention as well as a critical response on Twitter:

Recent Resignations and Departures

Notable executive departures disclosed in the last week include:

  1. CFO of Clover Health (NASDAQ: CLOV — $3.35 billion) resigned after one and a half years on the job “for personal reasons.”

  2. CFO of Taro Pharmaceutical Industries (NYSE: TARO — $2.54 billion) resigned after a little over one year “to pursue other opportunities.”

  3. CFO of Ross Stores (NASDAQ: ROST — $42.7 billion) resigned after a little less than two years to take a job with a competitor.

  4. General Counsel of Veracyte (NASDAQ: VCYT — $2.56 billion) resigned after one year.

  5. A board member of VEON Ltd (NASDAQ: VEON — $3.26 billion) resigned after a little over one year to “focus on other commitments.” The company has had four different CEOs and three different CFOs in the last five years.

  6. Former Senator Jeff Flake announced he would resign from the board of Taylor Morrison Home Corp (NYSE: TMHC — $3.01 billion) to serve as the U.S. Ambassador to Turkey.

  7. CEO of Shineco (NASDAQ: TYHT — $17 million), a Chinese herbal medicine company, was “terminated” after 62 days. The company has had five CEOs over the last two years.

Data for this section is provided by

FINRA Issues Special Notice About Retail Traders

The Financial Industry Regulatory Authority (FINRA) is requesting public comments on “Effective Methods to Educate Newer Investors.” FINRA wrote,

“As evidence emerges to suggest that newer retail investors have markedly different attitudes, characteristics and behaviors than their more experienced counterparts, the time is ripe to rethink how best to engage and educate investors… we seek input from firms, investors, investor advocates, academics and other stakeholders who are knowledgeable about investor behavior regarding the most effective methods for educating newer investors.”

Public comments can be made by email to or over the web.

*Tips Wanted*

The Bear Cave has some exciting investigations planned for the remainder of 2021. If you know of any companies misleading customers or shareholders, we are looking for new ideas too. Please hit reply or email with any companies that deserve additional scrutiny. The Bear Cave primarily focuses on U.S. companies with market capitalizations between $1 billion and $10 billion.

What to Read

“Warehouse for Amazon Aims to Go Public as Single-Property Business” (WSJ)

“The prospective property is a 146,000-square-foot Bay Area warehouse leased to LLC. The startup, ROX Financial LP, aims to use an initial public offering to create a real-estate investment trust that will acquire the Amazon facility. It then hopes to grow and own a collection of warehouses to serve the Seattle-based online giant…”

“The We That Didn’t Work at WeWork” (WSJ)

“Adam Neumann and Masayoshi Son pushed WeWork to new heights as they challenged each other to think big and bet billions. When their relationship unraveled, WeWork did too…”

“Behind the Lordstown Debacle, the Hand of a Wall Street Dealmaker” (NYT)

“Since he knew little about electric vehicles, Mr. Hamamoto hired McKinsey to assess whether the technology that Lordstown had licensed from others could be put together to build an electric truck, several people briefed on the matter said. The consulting firm said the technology was viable, and the deal came together in weeks…”

Tweets of the Week

Until next week,

The Bear Cave

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