Trinseo short interest is up over 60% in the last two months to 5% of shares outstanding and ~8% of the actual float.
In simple math, we walk through how EBITDA will quadruple to $510 million in EBITDA from consensus in the current year trough of $125 million.
Morgan Stanley's downgrade May 28th, from Neutral to SELL after 6 years at "Neutral" appears years late, as it is based on a contraction in styrene spreads to marginal cost, which has already happened.
While having bounced slightly off the bottom, the stock is still down over 71% from the 2018 high and has underperformed the group significantly.
Our model and assumptions are already appropriately-conservative given the environment. We remain perplexed that short interest and negativity are increasing and how someone can sleep at night being short a stock with so much upside.
March to May 2020 - The COVID Impact, and a big "V"
What a year 2020 has been so far, and we are not even at the halfway mark. We have witnessed volatility in the