Another Lie: Citron Research Continues as a Short Activist Firm
Remember in late January or early February, when Citron Research swore off of publishing any more short seller reports? A teary-eyed looking Andrew Left has stated that he is now focusing on long recommendations. Well it turns out that Andrew Left can’t even go couple months without bashing a stock. He recently came out with a report against Riot (which I don’t have an opinion on), bashing the stock and giving it a $2 target from its $55 high. The report have brought down the stock substantially, now trading around the mid 40s. However, (as stated) I don’t have an opinion on Riot.
What I do have an opinion about though, is that the guy swore off short selling. Actually, it is more of a fact. It is also important to note a few things as well. During the time that Andrew Left took a hiatus from short selling (because he is such a nice guy), MuddyWaters Research have commented negatively about some of the stocks Citron was short on. Among those stocks include $NNOX.
$NNOX also went down substantially after FDA approval on what seemed to be an uptrend. A report on my hypothesis can be seen here. A different person posted a report on some of the interesting pattern activities he seen regarding $NNOX. That report can be seen here. Myself and many other people also experienced significant draw-down in options trading. Even when the stock was down only a few percentage points, some people have exhibited losses of up to 30% in a single day. When the stock was slightly up, some people still experienced losses of up to 10% on some of their options positions.
Bears seem to be buying puts, while bulls are buying stock. While one can’t yet fully state that the unusual activity could be derived from Muddy Waters, lots of the sentiment seems to coincide with Muddy’s posts. It is also interesting to note that regardless, if Citron might be working with other firms to have shortened positions while he said he is no longer a short seller, that in itself is still him being a short seller. Either way, he is still currently now shortening another company after he said his firm will only be long.
Anyways, I suggest you look at the PDF report above which I also took the liberty of archiving here.
According to the SEC website:
“Although the vast majority of short sales are legal, abusive short sale practices are illegal. For example, it is prohibited for any person to engage in a series of transactions in order to create actual or apparent active trading in a security or to depress the price of a security for the purpose of inducing the purchase or sale of the security by others. Thus, short sales effected to manipulate the price of a stock are prohibited.”
That said, I am not saying this is what is happening with these short selling firms, but the activities happening regarding the trading of $NNOX has some hard to explain statistical anomalies. It would be interesting to compare these anomalies w/ some of the stock’s biggest drops, options activity, and maybe even compare this pattern with stocks that were heavily shortened in the past.
I feel like people might not be seeing the bigger picture in regards to what is going on with Nanox. That said, I am still quite long. I do believe they have important milestones and deliverables in the future. It is also important to note what some bears are saying with a grain of salt. As one can tell, one can’t even be certain if a bear truly will decide to no longer be a bear.
I do engage in research related to the sensory tech and medical device industry. However, I hold no relations to Nanox Imaging or working with Nanox Imaging. My only current conflict of interest is being long on its stock.
Disclosure: Please keep in mind, everything I say is on an opinion based basis. This is not meant to be taken seriously or as actionable financial advice. Do your own due diligence and any trades/investments you do is at your own risk. We are not responsible, proceed with caution and we are trying to voice an opinion not meant to warrant action. This is solely meant to be viewed as a non actionable opinion not meant to be taken as seriously or as a form of actionable advice.
