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Following Herbalife's (HLF) 20% plunge, D.A. Davidson's Tim Rainey agrees with the company that...

Following Herbalife's (HLF) 20% plunge, D.A. Davidson's Tim Rainey agrees with the company that the selloff creates a buying opportunitydismissing David Einhorn's probing: "If anyone else had asked the question, we would have wondered why time was being devoted to such basic inquiries... This was an excellent quarter from an excellent company with high ethics and strong accounting."
Comments (5)
  • BHL
    , contributor
    Comments (42) | Send Message
    Wow Tim Rainey likes the controversial ones...he's been a big bull on DMND also. And he always has a bit of an edge to him, no lack of confidence. GL with that.
    1 May 2012, 06:43 PM Reply Like
  • ogiflip
    , contributor
    Comments (2) | Send Message
    David Einhorn made one good bet on Lehman, did his short story thing there and now the markets listen to him, makes me laugh. Do you really think that one question can hit an 8 bln dollar company so hard that everything goes down- yes a little only for one trading session. Remember Eastman Kodak go from 1,40 to 0,50 due trading session on rumor for Chapter 11? What happened end of trading day with 0,70, opened the next day 1 USD and after 15 minutes again on 1,40 USD. Made a lot of money on EK. The same here with HLF in less than one week HLF will be among 65-67 USD . Don't buy this bullshit from Einhorn and make your money on the way up before it's too late, cause David made his profits on the way down don't be fooled. You'll see for yourself, won't comment anymore.
    2 May 2012, 04:25 AM Reply Like
  • Larry the Lobster
    , contributor
    Comments (25) | Send Message
    I Concur,
    2 May 2012, 08:06 AM Reply Like
  • tikigod18
    , contributor
    Comments (908) | Send Message
    HYPOTHETICALLY speaking:


    Here is the silly minimal version of the trade: company announces earnings, stock doesn’t move much. There’s a call at 11am. You short the stock. You get on the call. You ask questions like “why are you no longer disclosing what you used to disclose?” The company answers “because it’s not helpful.” You’re all “thanks.” You hang up. The stock drops 20%.


    The company announces it’s a buying opportunity and they have a $428mm share repurchase authorization. You … go sell back to them the next morning. 24 hours, 20% profit.


    There are obviously some necessary conditions here. The tone of your voice in asking those questions is crucial. It sure helps if the company is … umm … let’s say, a network marketer of weight loss pills. It is critical that you be a famous short seller with a good track record of getting short calls correct.
    2 May 2012, 09:32 AM Reply Like
  • poortorich
    , contributor
    Comments (2265) | Send Message
    Pretty amazing what a few words can do. Just look at hlf's financial statements over the past few years....thats all you need to know.
    2 May 2012, 09:33 AM Reply Like
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