David Einhorn could be the best short seller on the planet. He may even be better than the legendary Jim Chanos. Herbalife was trading above $70 per share just before Einhorn asked a simple question during the company’s conference call. That was enough to push the shares down significantly. Right now the stock is trading below $47, losing a third of its value in a short few days.
Last fall Einhorn presented his short thesis on Green Mountain Coffee Roasters (GMCR). The stock plunged to $40 in the following weeks and then recovered to $70 by the end of February. However, that wasn’t the end of the story. Right now, the stock is trading at $25, losing half of its value today after a disappointing earnings report and outlook. Green Mountain is becoming a value stock. Whitney Tilson could initiate a long position any second.
We are wondering whether David Einhorn would short Edvard Munch’s ‘Scream’ which was sold for a record breaking $120 million. Clearly, the Art Market is in a bubble. Unfortunately there isn’t an easy way of trading in this market. Maybe John Paulson could ask Goldman Sachs to bundle some artwork and create a tradeable financial instrument out of it.
Anyway, Ira Sohn Conference is a few weeks away and we will find out what David Einhorn is up to.