Einhorn's Greenlight shorts athenahealth, says at 'wrong price'

Reuters

(Adds quotes, details on Einhorn's views on company)

NEW YORK, May 5 (Reuters) - Hedge fund manager David Einhorn said on Monday that athenahealth Inc is one of the companies in which his firm, Greenlight Capital, has taken a short position.

Einhorn, speaking at the Sohn Investment Conference, said shares of the company, a provider of software for healthcare records and billing, could fall 80 percent from their recent peak. In the last year, the stock has surged 46 percent.

"It isn't positioned to succeed the way the bulls hope," said Einhorn, who is widely followed by other investors. "The stock is simply at the wrong price."

He said that athena will not become the preferred supplier of software for hospitals.

In his presentation, Einhorn worked step-by-step through a recent Morgan Stanley report on athenahealth, pointing to assumption after assumption that he called overly optimistic.

Athena "has much farther to fall," he said.

Einhorn interspersed his talk with video clips of athenahealth's chief executive, Jonathan Bush.

"Jonathan Bush likes to compare athena to Amazon. ... When a store adds a website, it does not magically become a cloud-based retailer," Einhorn said. "His use of the word cloud is somewhat nebulous."

Shares of athenahealth closed at $126.78 on Monday. The stock was down 12 percent in after-hours trading.

The Sohn Investment Conference, an annual event that helps raise money to fight pediatric cancer, is where Einhorn unveiled his short bet against Lehman Brothers in 2008 before Lehman collapsed.

Einhorn on Monday said he would not name other stocks that his hedge fund is shorting.

Greenlight Capital, which manages $10 billion, gained 4.3 percent in April.

(Reporting by Svea Herbst-Bayliss and Luciana Lopez; Additional reporting by Rodrigo Campos and Sam Forgione; Editing by Leslie Adler)

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