They might not be wrong, but that would be a happy coincidence imo
Also, seems like they've had some decent wins in the past: https://scorpioncapital.com/track-record
What is dubious about this mechanism? It seems fairly straight forward and short selling doesn’t even depress the price any more than someone simply selling it to the market. In fact since they have to buy it back later they first create sell pressure down then buy pressure up later.
It's a lot more due diligence than most investors. (e.g. consider r/wallstreetbets)
Yes, the IonQ prospectus does have a lot of hockey-stick graphs and lots of roadmaps that look ambitions. And yes, they do distance themselves from all of those graphs in the footnotes. I do find that suspicious and somewhat misleading, too.
And an employee saying "I guess [the old fired CEO] wasn’t hype enough. And then this [new CEO] came in and just set up a SPAC, just to go public." seems pretty damning, too.
This is what they produce - quantity over quality. This is what their managers think the client wants - they are paying by the hour afterall, got to give them a big pile or work.
You can only have two of; fast, accurate and magnificent prose.
The question is: how much money you're willing to bet that they're wrong?
Sales and profit are real and 100% liquid unlike the marketcap which is essentially a perpetual voting machine.
If the product is legit and starts selling , then it's gonna be shortsellers to lose out and and people betting on the company would win as long as they don't screw themselves using leverage.
Marketcap can be deflated instantly just if enough people click the sell button.
If you want to compare them you have to discount the marketcap adjusting it for the instability and undecisiveness of the human brain and also the instability of the marketplace of ideas and political currents, the instability of hero worship around the CEO and millions of other things. Once it's said and done it's a pretty big discount you have to apply.
Not only that, but if this is false it seems extremely actionable. Couldn't the characters here sue the pants off the authors if these claims are false? Not to mention the exposure to SEC action for taking a short position and then slandering the company. I know this does happen and is rarely prosecuted but combined with the civil liability that seems like a lot of exposure for Scorpion Capital.
For sure, it's badly written, and lazily formatted. It does extrapolate quite a bit from the data it gathers, and has no undisputable evidence. But then, it's way too much to expect some small private group to do elaborate reports and gather evidence suitable for a criminal court.
If you catch them being wrong, that would be enough of an issue to discredit them. But none of the above is.
I see comments like this in any discussion involving short sellers, and I've not been given any reason to believe it is more than sour grapes. But my mind is open to it.
Yes this is theoretically possible but no it is not likely someone can make a career out of it. Short research isn't a magic wand that makes the price go down. Good faith short sellers have their positions blow up in their face all the time, sometimes just because people don't like them and wouldn't mind seeing them get their comeuppance. A short seller publishing in bad faith would be fighting an uphill battle while surrounded by easier grifts.
Surely there must be some frauds among the short sellers some of them time, but there's a common view that it's all of them all of the time. From my perspective this appears to be a conspiracy theory among bulls who think that publishing negative information about any company is a threat to their portfolio, and reason backwards from there.
as opposed to what? being a neutral observer? taking a short position after publishing the report? this is basically standard behavior from short-sellers.
They compare the public messaging from executives and the company website with what is publicly disclosed in the company perspective.
The report could have been 4 pages long.