Value Investing Shares of China’s Luckin Coffee plummet 80% after investigation finds COO fabricated sales |
- Shares of China’s Luckin Coffee plummet 80% after investigation finds COO fabricated sales
- Luckin Report..
- Jim Chanos says he covered bet against Luckin Coffee amid 70% plunge Thursday
- General Dynamics (NYSE: $GD) - Investment Thesis
- $WDFC short report by Spruce Point
- Oaktree Capital - Relative Value with Howard Marks, Armen Panossian, Madelaine Jones and Justin Guichard
- $GDS short report by J Capital
- $CUB short report by Glasshouse
- U.S. Jobless Claims Totaled 10 Million Over the Last Two Weeks
- Chapter 1: The Big Picture in a Tiny Nutshell (Ray Dalio)
- Gavin Baker – Investing Through a Bear Market
| Shares of China’s Luckin Coffee plummet 80% after investigation finds COO fabricated sales Posted: 02 Apr 2020 06:12 AM PDT |
| Posted: 02 Apr 2020 06:44 PM PDT To any of you that read the actual report (I found it in this subreddit from a google search) do you know who is actually behind it and why? Muddy Waters and Andrew Left of Citron got into a debate about it, but it only goes so far as "It came in from an unknown 3rd party and MW followed through on it, good for him". The report itself is incredibly thorough, and honestly reminds me of some Guerrilla type research campaign. For those that haven't read it; The dude employs over 1000 full and part time employees to go to over 600 stores and surveil them for 900+ full store-days (not 900 days consecutively, approx 1.5 days per store I forget exact numbers). Not to mention figuring out they were over reporting their ad spend by tracking the exact company that was used and putting together the pieces of what seems would be quite a significant campaign. Then, what I find to be most impressive, is they somehow gathered 25K+ receipts from customers and figured out they were exaggerating how much each customer spent and in reality they were offering larger discounts. There was much more, but for the sake of brevity that's all I'll address. All of this was used to infer that they were cooking the books and vastly overstating their revenue numbers in financial reports in order to appease investors (as well as garner new investments), inflate stock prices and eventually use their stock pledges to leave investors hold the bag. The researcher even traced certain management back to a former company where they did the exact same thing.. So what's kind of been bugging me about all this, is why? That seems like such a considerable amount of time and effort not to mention the resources expended. For what? It had to be more than just a hunch. Does anybody have any more details on who this researcher was or why Luckin flew onto his radar? Or for you research professionals in general, what are some of the first indicators you notice that draw your attention to a juicy short? TLDR: Review of Luckin report and questioning who's behind it and what the first indication of a short like this is. [link] [comments]  |
| Jim Chanos says he covered bet against Luckin Coffee amid 70% plunge Thursday Posted: 02 Apr 2020 10:51 AM PDT |
| General Dynamics (NYSE: $GD) - Investment Thesis Posted: 02 Apr 2020 01:46 PM PDT Disclaimer: This report is for informational purposes only. I do not hold any positions in $GD Company Overview General Dynamics (NYSE: $GD) is a global Aerospace & Defense company that provides products and services in business aviation, combat vehicles, weapons systems and munitions; information technology (IT) services; command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR) solutions; and shipbuilding and ship repair. This business consists of 5 operating segments:
Valuation Assumptions: With a risk free rate of 0.58% (10Y T bond), calculated cost of equity at 12.56% (high equity risk), and cost of debt at 1.24% (low interest rates), the weighted average cost of capital is 7.80%, slightly higher than the industry average. Over time, I assumed that this would converge to the industry average of 7% With revenue growth, I assumed a 4% drop for the next year due to potentially reduced business jet demand as a result of the COVID-19 pandemic. After the first year, GD would recover and grow at the current 8% revenue growth rate, until it reached 2% (expected risk free rate) growth in perpetuity. Similarly, with operating margins, next year's operating margins might be affected by the pandemic and hence I assumed 9% for the same. When GD recovers, it's operating margins are going to be in line with industry averages and its past performance at 12%. Currently, GD is enjoying a 17.5% effective tax rate, however, I assume that these advantages will fade over time and the tax rate will converge to the marginal tax rate. As the company grows, I also assumed that ROC will grow from 10% to 12%. However, this is not competitive with the industry average of 33.93%. Cash Flows: The figure shows the cash flows of revenue and operating income under these assumptions. Value: Discounting the above cash flows to the cost of capital gives us the firm value of $71,606 million. Removing debt and adding back cash yields the value of equity and results in an intrinsic value of $158.24 per share. Risks General Dynamics relies on the U.S Government for a significant portion of their revenue: Sales to the U.S Government accounted for 65% of the consolidated revenue for FY2019, and decreases in U.S. government defense spending or changes in spending allocation or priorities could result in programs being delayed or terminated, which could impact performance. The Aerospace segment is subject to changes in customer demand for business jets: Unlike defense products, business jet demand is subject to market conditions, which could impact performance. Conclusion General Dynamics is a highly diversified company in terms of product/service range and is an essential part of the U.S Defense industrial base that supports the DoD and its allies. With the current valuation and $GD trading at $127.40, I recommend $GD as a buy with a price target of $158.24. Thank you for reading my report. Feedback and suggestions are welcome. [link] [comments]  |
| $WDFC short report by Spruce Point Posted: 02 Apr 2020 11:27 AM PDT |
| Posted: 02 Apr 2020 10:50 AM PDT |
| $GDS short report by J Capital Posted: 02 Apr 2020 09:50 AM PDT |
| $CUB short report by Glasshouse Posted: 02 Apr 2020 07:05 AM PDT |
| U.S. Jobless Claims Totaled 10 Million Over the Last Two Weeks Posted: 02 Apr 2020 06:24 AM PDT |
| Chapter 1: The Big Picture in a Tiny Nutshell (Ray Dalio) Posted: 02 Apr 2020 07:55 AM PDT |
| Gavin Baker – Investing Through a Bear Market Posted: 02 Apr 2020 04:56 AM PDT |
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