Jeremy Raper
Long/short equity, deep value, special situations, growth at reasonable price

Advanced Drainage Systems: Analyst Insanity Plus Accounting Issues Create A Fat-Pitch Short Opportunity

It can be tough to get comfortable with shorts in a market that is already down significantly this year: a lot of the 'bad stuff' - as well as a ton of good stuff - has already been obliterated to the point where shorting down here can be pretty hairy. As such, when resetting shorts in this kind of environment, I try to look as much as possible for uncorrelated and/or idiosyncratic trades for which the outcome - whether it works or not - is as much divorced from a market snap-back as possible.

I think Advanced Drainage Systems (NYSE:WMS) sets up pretty nicely as a medium-term short from this perspective. As we shall see, it presents an

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