I just mentioned the hedge fund hotel status of Valeant pharma last week. Well, for no reason other than a Wells Fargo analyst note last week, said hotel is on fire right now.
Shares are plunging, in a more than notable decline. This has the look of liquidation, someone forced to get out in order to save a fund or a very large account.
I hate to keep picking on Ackman, but he’s awfully concentrated amongst a few positions, VRX being chiefly his largest and most important.
For now, his other positions are holding up, namely APD and CP. Still, the ruinous losses in his VRX position alone, just for today, is about $200 million.
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the equity has toe fungus
I do not think that he would give up the fight so soon. Nonetheless, somebody – or a lot of somebodies – is dumping this mess.
If you look under the hood on the search engine/analytics space, there are not many left standing on the field of battle. What are there, 3 or 4 majors now? YNDX is one of them and has some features superior to the rest. Indeed, it is not out of the question that they will defy the coming broad market sell-off. Disclaimer: no position other than your contest. Still, hedge funds would do well to consider the possible outcome here.
The worst is yet to come for VRX.
YOU KNEW?
Holy crap, this thing has a PE of 40? That probably should be more like 20. This stock might be interesting at $30.