Such reports are often met with a dose of skepticism by traders and the companies profiled largely rebuke the claims within. Its report on Lordstown Motors discloses that Hindenburg has taken a short position in the company, though without knowing how much stock it’s bought or when, it’s hard to tell how much Hindenburg stands to earn. While Anderson says Hindenburg exists to “expose all of the things that enable fraud to pervade across the financial system,” as he told Barron’s, the company is still a short seller. “For us, it’s not just about going deep enough for a trade, we want to go deep enough to hit beyond a reasonable doubt threshold.” We want to make a dent,” Anderson continued in the Barron’s interview. “The only reason we’re any good at what we do, is because the team is inherently troubled by how broken the market is and how broken the financial system is. Read: Source Cited in Hindenburg Research Report Refutes Its Claims We expect insiders to continue to unload.” “Company insiders and key stakeholders seem to agree they have been aggressively dumping shares over the past several weeks/months. A reality check is on its way,” a tweet thread started. We see the chance of winning a material USPS contract as virtually zero. The company has an astronomical valuation of ~$1.5B despite less than $100k in revenue last quarter. “We’re short $WKHS because we think there’s immediate 50% downside. Last July, Hindenburg set its sights on Workhorse Group, an electric vehicle startup founded by current Lordstown Motors CEO Steve Burns that was named a finalist to build the Postal Service’s next generation delivery vehicle. “We have never seen this level of deception at a public company, especially of this size.” “We have gathered extensive evidence – including recorded phone calls, text messages, private emails and behind-the-scenes photographs – detailing dozens of false statements by Nikola founder Trevor Milton,” the report started. That report, released in September, eventually led to an investigation by the SEC, the ouster of Nikola’s founder and General Motors backing out of a deal to partner on an electric truck. We also look for recidivists, or bad actors in management that have a history of stock promotion or securities fraud, or being associated with companies or businesses that have been charged with securities fraud or other kinds of white-collar crimes,” Anderson told Barron’s in September.Īmong its high-profile reports is one on would-be Lordstown Motors competitor Nikola, detailing the belief that Nikola had overstated the capabilities of its technology.
“In general, we use some pretty traditional ways of screening for accounting red flags and the like. Hindenburg reports have targeted a wide range of companies, from electric vehicle startups Lordstown Motors and Workhorse Group to international energy companies to health-care companies. It’s also a hedge fund that often takes a short sell position in the companies it reports on. Founded in 2017 by Nathan Anderson, the company produces investigative reports by digging through accounting and talking to former employees, analysts and industry insiders.
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