Shares of $FIZZ are all over the place today after Glaucus Research group issued a 62-page report. They are also short sellers in the stock.
National Beverage Corp, parent company to beverages sold under brand names like La Croix, Faygo (Detroit, where my juggalos at?), and Shasta issued a response shortly after calling the report “false and defamatory,” in a scathing take down of a report they claim was intended to “severely manipulate” the company’s stock price.
After being down nearly -20% today, the stock has rebounded but is still off by -6%.
Glaucus Research has made some good calls in the past, including shorting AAMC in early 2014. They produced a Hitler parody during their stay as short sellers, putting custom subtitles on the widely parodied German film “Donwfall.” It’s actually hilarious, and they were right. AAMC shares went from over $1000/share to right around $10/share today. Here’s the video:
Glaucus has had some other hits (and misses) along the way. Bloomberg with the details below:
Glaucus, which publishes most of its research reports on its website, has targeted more than 20 companies around the world. It came to prominence with a report on U.S.-listed Universal Travel Group in March 2011, claiming the Shenzhen, China-based company falsified its financial statements. The company voluntarily delisted in April 2012. The next year, Universal Travel and two former executives agreed to pay $935,000 to settle a U.S. Securities and Exchange Commission lawsuit alleging that it defrauded investors.
More recently, Glaucus made its first foray into Japan in July when it criticized the accounting of Itochu Corp., which trades everything from commodities to clothing. Itochu strongly denied all allegations. While the shares tumbled the day of the report, they’ve since recovered all losses.
Glaucus also targeted Hong Kong’s Tech Pro Technology Development Ltd. at the end of July, sending the shares down 86 percent the day it said the company overstated profits and inflated the purchase price of acquisitions. Tech Pro demanded an apology, saying the report “has no merit” and is “defamatory.”
Source: Tom Redmond, Bloomberg
In good form, National Beverage Corp immedietly came to the rescue of their shareholders (mostly Nick Caporella, the company’s chairman, chief executive officer and founder, who holds 74 percent of its shares) and issued a PR response.
A false and defamatory “research report” was published today by Glaucus Research Group (whose actions relative to other alleged manipulations can be found on the following site http://www.ipetitions.com/petition/open-letter-to-the-sec-to-regulate-market-manipula). We believe that this “report” was intended to severely manipulate our stock price downward in support of short sellers, whose short position has dramatically increased over recent weeks. The allegations in this “report” are untrue and are based on allegations made in a complaint for the purpose of extorting money from the company. That action was dismissed as being without foundation and the complaint was found to be based on lies. Having failed in that effort, the plaintiff and others associated with him, in violation of both confidentiality agreements and court orders, shared his false allegations with short sellers and their co-conspirators.
These wild swings are creating opportunities for short sellers to cover, longs who trust the company to add, and momentum traders to just get inside the tape and poke out some gains.
The hit piece calls for an investigation into the firm’s accounting practices. If they succeed in having an investigation launched, even if it is ultimately proven untrue, share of FIZZ could be in the proverbial ‘fag-box’ for a long time.
Writers note: I started buying FIZZ literally two days ago, FMLComments »