I read that article also, and decided to ADD to my Shop holdings. Its now a very oversized holding, but this is the same guy that attacked Ubiquity last week, and that stock rebounded nicely.
background on Mr. Left ,head of Citron
https://en.wikipedia.org/wiki/Andrew_Left
Left’s first job was with Universal Commodity Corp, a high-pressure commodities brokerage firm that hired salespeople to make cold calls and push “questionable investments.” Left quit in March 1994, after 9 months with the company. When the National Futures Association sanctioned the firm in December 1998, Left, along with every other former employee, was sanctioned for three years along with being required to take an ethics-training course as part of the probe into the firm for making false statements to sell commodity futures contracts.
The National Futures Association stated Mr. Left “made false and misleading statements to cheat, defraud or deceive a customer in violation of NFA compliance rules.”
In 2016, the Hong Kong Securities and Futures Commission accused Left of spreading false and misleading information about Evergrande Real Estate Group Ltd.
Later in 2016 A Hong Kong tribunal banned Andrew Left from trading for five years after publishing “false and/or misleading” claims about China Evergrande Group. Left was ordered to repay HK$1.6 million in trading profits, pay about HK$4 million in legal expenses, and face criminal prosecution if he breaks Hong Kong rules again. ]
I would love to see a case history of his shorts. Prices one day before publication, one week afterwards and 3 months afterwards. I suspect but do not know that in the past majority the 3 month price has been higher.
SHOP was vulnerable because of high P/E and a paucity of previous FUD. Left got his price decline. He will cover and move on. I am not so sure about investors who copy - catted after him. Personally when I think the underlying company is sound I use Citron calls as a buy signal.
The "millionaire " bit about Shopify shows the company overstates sometimes. But not say anything about the underlying business. The more e commerce, the more people will participate and most will use the best platform to do so.(Shopify)
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SHOP was vulnerable because of high P/E
Well, technically SHOP doesn’t have a P/E yet. There is a P obviously, but no E. Estimated forward P/E is ~500, coupled with EV/S of ~21. So, yeah, this stock was (and still is) an accident waiting to happen.
Alex
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I thought that their situation was that they could make a profit, but were running at a slight loss in order to spend more on getting new customers to build market share and stay way ahead of the competition.