Greenlight Capital, an investment management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. An annual return of 11.9% was recorded by the fund for the whole year 2021, compared to the 28.7% of the S&P 500 index for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Greenlight Capital, in its Q4 2021 investor letter, mentioned Danimer Scientific, Inc. (NYSE: DNMR) and discussed its stance on the firm. Danimer Scientific, Inc. is a Bainbridge, Georgia-based renewable and sustainable biopolymers provider with a $523.7 million market capitalization. DNMR delivered a -45.66% return since the beginning of the year, while its 12-month returns are down by -89.90%. The stock closed at $4.63 per share on February 2, 2022.
Here is what Greenlight Capital has to say about Danimer Scientific, Inc. in its Q4 2021 investor letter:
“Danimer Scientific (DNMR) fell from $16.54 to $8.52. The primary driver was its inexplicable mismanagement of the capital situation. When the company went public through a merger with a SPAC in late 2020, investors were led to believe that DNMR’s plan to bring online a large new plant in late 2023 was fully funded. Subsequently, the company doubled the size of the planned plant and did a large cash acquisition of an adjacent product. Investors were told that the company intended to finance the higher construction costs with debt through government-sponsored programs or project finance. During the fourth quarter, that turned out to be… not true. Suddenly, the company decided it needed to raise money. A convertible bond was hastily issued on terms that were unattractive to the company. Rather than complain about the dilution, we invested in the convert and sold most of our common. This way, we moved up a level in the capital structure, will collect a coupon, and given the favorable terms, will participate in most of the upside, should it develop.
On that note, we double checked our due diligence and spoke with a number of DNMR’s customers. We continue to believe that there will be enormous demand for its biodegradable plastic.”
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Our calculations show that Danimer Scientific, Inc. (NYSE: DNMR) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. DNMR was in 21 hedge fund portfolios at the end of the third quarter of 2021, compared to 30 funds in the previous quarter. Danimer Scientific, Inc. (NYSE: DNMR) delivered a -76.02% return in the past 3 months.
In May 2021, we also shared another hedge fund’s views on DNMR in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
