Another example of Ackman buying in front of a deal that VRX eventually buys out at an obscene price. Just some very shady stuff and now news is out that female viagra product from Sprout is a complete dud.
Ackman already said that debt level of the company is a problem, and I guess we had that discussion yesterday already just go to leave it at that.
100% agree if he was hedged, although we have to disagree on that one. Now that you mention it, given Ackman has such inside reach and owned over 5% of VRX, I'm wondering if SEC disclosures are necessary for his derivative positions, if he had any. And if he was a 5% holder, I think that would trigger disclosure on form 3 or form 4s. I could be wrong.
I think overall, his track record is still some huge profits despite this loss and he can say he earned 40% last year and the next hot idea, he promises to deliver and they learn from this one...etc.
more like asset sales, but doubt whole company will be sold. The issue is Ackman and other investors, ironically, would stand in a way of a deal even if offer is 50% above current prices because his cost is $188/shr. Unless public sources of his costs are incorrect, then i doubt Ackman would accept a deal that puts him in deep red. Then again, in the past, Ackman have used potential deal info and traded on it so maybe he will buy a lot more before the deal gets announced to make it worth his while - just better hope SEC watchdogs are still asleep.
I don't they were hedged, these guys are paid to take risks, lots of it. Those fees they get paid from clients aren't for them to smooth risk and lower returns - maximize alpha. Why would I give him money to invest and pay lots of fees if I can do the same thing and hedge away the risk? high net worth individuals count on Ackman and other hedge funds for their expertise in taking on risks, but at the same time, these individuals would be expected to face downside risks as well.
of course they are worried about the other selling, so not unheard of in these sort of situation where selling could continue to crater the stock that remaining big existing investors would come to some understanding about how to handle this situation jointly on what will trigger them to sell and at what price and what volume.
Yeah, I bought into that exact same concept that Ackman and Pearson were like a dynamic duo. I actually thought Ackman's cowboy ways of doing things on the fringe was interesting and profitable. Combined with Pearson aggressive M&A style in this hot space, I thought this was a must investment at the time. Yes, I bought into the story and did well, until campaign 2016 rolled in and Hillary made biotech her bad boy story when I sold nearly all my biotech stocks and that is I think one has to recognize the fundamental landscape has changed for biotech - price gouging might be a thing of the past. And now both side of the parties are asking for investigation so even if Dems don't take 2016, the issues remain. And that is before all the internal issues at VRX are taken into account. Too much headline risk still in this stock.
wow, sorry that is quite a hit, I actually had the same stocks you held, BAC and DNDN when both cratered too but not in that loss magnitude. And I had VRX but sold 170ish at loss. Very rare for stock to fall like this and bounce back when so many questions involves legal, financial shenanigans and other problems. Sometimes stocks get dump to get weak hands out like they did at EXPE in February and it doubled since but I had to stay discipline and sold that one too. Unless one is an insider, can't never be sure these 20% haircuts are not bigger problems than just trading against weak hands.
not how the real world works, public company typically has D&O insurance that pays for legal representation of their officers and board members during time of crisis will cover him regardless of whether he is with the company or not. Without that coverage, all directors will quit on the spot. However, if he committed fraud and violated company policy, he will be on his own defending himself and maybe even Valeant will sue him.
and Sequoia funds tried to get some of these ex-employees to talk only to Sequoia. The whole setup just reeks from head to toe - even investors are a shady bunch - no wonder some of Sequoia independent directors resigned.
looks like GS did Pearson a favor here and thank die hard longs here for taking it off his hands.
more like no buying interest, stock going down doesn't mean shorts are pushing it down - the MM will walk this price down when no one is offering to bid for it... the fact that Citron is not shorted anymore is actually not good for longs, you need shorts to provide cover and squeeze.