The Bear Cave #90

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

Nov 07, 2021

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New Activist Reports

Quintessential Capital Management published on Cassava Sciences (NASDAQ: SAVA — $3.64 billion), a controversial drug company focused on treating Alzheimer's disease that was previously criticized in a high-profile Citizen Petition with the FDA. Quintessential Capital alleged the company has forged its scientific research and wrote,

“This alleged exercise in deception has taken place with the involvement of an astounding number of questionable characters: Cassava’s former Senior Clinical Research Associate is a convicted felon with a record in fraud and theft. Cassava’s prominent clinical research site (whose CEO is coauthor of critical research on Simufilam), IMIC Inc., is co-owned by a former escort, stripper and crack addict with a criminal record for consumption and possession of cocaine.”

Quintessential Capital gave Cassava stock a price target of zero. Former hedge fund manager Marc Cohodes and Ph.D. student Adrian Heilbut also tweeted critically about the company.

Unemon published on Ubiquiti Inc (NYSE: UI — $19.3 billion), a Wi-Fi router company. Unemon highlighted the company’s reliance on overseas manufacturers and claimed that ongoing supply chain disruptions would impact the company’s sales and deliveries. Unemon also contrasted consumer complaints on Ubiquiti’s community forum with the company’s stock market outperformance compared to its competitors.

Prescience Point Capital tweeted bullishly on Penn National Gaming (NASDAQ: PENN — $10.4 billion):

Prescience Point Capital Management @PresciencePoint

We are long $PENN. The sharp selloff from the @stoolpresidente article reflects a huge dislocation from actual biz fundamentals. Core casino business alone is worth +$75/share, +30% from here + free option of @barstoolsports. All-in we think $PENN can +2x.

Recent Resignations

Notable executive departures disclosed in the past week include:

CFO of Faraday Future Electric (NASDAQ: FFIE — $2.83 billion) resigned after less than one year on the job “to pursue other opportunities.” The company went public via SPAC in July.
CEO of XL Fleet (NYSE: XL — $744 million) resigned after less than a year “to pursue other career opportunities.”
CFO of PureCycle Technologies (NASDAQ: PCT — $1.50 billion) resigned after about thirteen months.
CFO of World Wrestling Entertainment (NYSE: WWE — $4.47 billion) resigned after a little under one and a half years
Jean C. LaTorre resigned from the board of First American Financial Corp (NYSE: FAF — $8.29 billion) less than six months after joining. Her three-sentence resignation letter did not provide a reason for her departure.
Chief Medical Officer of Codiak BioSciences Inc (NASDAQ: CDAK — $375 million) “separated from the Company” after less than six months.
Chief Sales Officer of Guidewire Software (NYSE: GWRE — $10.4 billion) “mutually agreed to part ways, enabling him to pursue another opportunity” after less than one and a half years on the job. The company has had four different CFOs and two different CEOs over the last five years.

Data for this section is provided by InsiderScore.com

What to Read

“Prepared Remarks At the Securities Enforcement Forum” (Chairman Gensler)

“I’ve learned in my first six months here that there are all too many fraudsters, penny stock scammers, Ponzi scheme architects, and pump-and-dump cons taking advantage of investors. We have to protect the public from as many of these scams as possible.”

“Zillow’s Growth Prospects Dim as It Exits Home Flipping” (WSJ)

“Zillow said it made the call to stop flipping homes because its tech-powered platform couldn’t make accurate price forecasts. As a result, Zillow lost hundreds of millions of dollars on homes during the greatest housing boom in recent history.”

“Idea Brunch with Brian Bellinger of Monimus Capital” (Sunday’s Idea Brunch)

“A close friend and fellow fund manager once told me, ‘If you are intellectually curious, the stock market is the best game in the world.’ And that’s absolutely true. Since childhood, I’ve had a natural affinity for identifying patterns or inconsistencies, solving puzzles, and sleuthing. The stock market is a perfect environment for exercising these skills. I come in to the office each day excited to tackle the challenges that the market presents.”