September, 2018 (Volume: 35 / Issue: 9)
In Focus


Einhorn ... blasting frackers

Greenlight’s Einhorn slams oil frackers for burning cash

The hedge fund manager, who often unveils short-bets against companies at these events, cited Pioneer Natural Resources as a particular offender

BILLIONAIRE hedge fund manager David Einhorn, who often moves a stock simply by speaking its name, kicked off the year’s most prominent investment conference by laying out a case against oil frackers, arguing these companies drill “lots and lots of holes” and burn through plenty of cash.

Einhorn, who often unveils short-bets against companies at these events, cited Pioneer Natural Resources as a particular offender at the 20th annual Sohn Investment Conference. “We call it the motherfracker,” he said, prompting investors to kick the share price down as much as 5.3 per cent. The company should trade closer to $78 a share, he said, not the $166.50 the stock is trading at now.

“Pioneer is burning cash and its reserves are not growing,” said Einhorn, who runs $11 billion Greenlight Capital, adding “Pioneer ought to stop touting estimates based on stale pricing.” The company is losing 20 cents of present value for every dollar it invests.

Einhorn also mentioned EOG Resources, which he called the “father fracker,” Concho Resources, Whiting Petroleum and Continental Resources.

Last year Einhorn unveiled a short bet against athenahealth at a previous Sohn conference and was the first to underscore problems at Lehman Brothers months before the investment bank filed for bankruptcy.

Einhorn was one of the few investors at the conference who unveiled a short bet, as most other investors put forth ideas that investors can buy and hold.

Leon Cooperman and David Tepper talked about markets and sought to soothe investors fearful that the long-running equities bull market might be over.

Tepper, founder of Appaloosa Management, shocked markets a year ago by warning that investors should not be too long in the stock market. He said that investors should not be “too long bonds, not too short stocks” and warned that investors should be careful with commodity investments.

Investors at this conference, even the billionaires, are told to keep it short and talk no more than 15 minutes. Tepper who didn’t use all of his time joked that he would sell some of his unused minutes to Bill Ackman, who is known for speaking at a breakneck pace to race through dozens and dozen of slides.

Cooperman, who runs Omega Advisors and has long been saying the stock market would continue to climb, stuck by his bullish outlook, saying the stock market can still end higher this year. “If there is a bubble out there, it is not in the stock market,” Cooperman said, adding it may be in the fixed income market.

He pitched a handful of US-based companies including Google, Dow Chemical, Priceline Group and drugmaker Actavis.
Picking up on the pharmaceutical industry theme, Larry Robbins, who runs Glenview Capital Management, touted AbbVie, saying the stock price could double. The company’s price is relatively cheap and management is disciplined, Robbins said.

Even though AbbVie called off a planned $55 billion takeover of Shire late last year, industry analysts are still holding out forecasts that the breakneck pace of mergers and acquisitions in the pharmaceutical industry will continue. The company could be taken over or it could be the one taking over someone else, Robbins said.

Ackman, founder and chief executive of Pershing Square Capital Management LP, talked about his most recent addition to the portfolio: Canadian pharmaceutical company Valeant Pharmaceuticals International Inc VRX.TO, which he called “massively undervalued.” He said companies that buy up others at a steady pace are often misunderstood and said Valeant, which announced plans to buy Salix earlier this year, is an early stage Berkshire Hathaway, referring to Warren Buffett’s company.

Keith Meister, a former Carl Icahn lieutenant who now runs $8 billion Corvex Management, focused on fast food restaurant chain Yum Brands, saying his firm is one of the five largest investors and that the company is Corvex’s second-biggest investment ever. Daniel Loeb’s Third Point said it had taken a significant stake in Yum.

NEW MINNETONKA Middleton Mini Boots (Size 6) , DINGO Womens Size 8 Cowboy Western Bootie , Logo Brown Velvet & Faux Fur Trim Victoria Ankle Boot 9 Lori Goldstein , Gaimo Cotton Washed Wedge Ankle Boot Espadrilles - Handmade in Spain , Dolce Vita Women's Mazey Studded Velvet Booties Size 8 Navy Retail $180$179 Steven by Steve Madden Womens Insight Knee Wedge Boot Shoes, Black, US 7Justin Pink and Silver Western Cowboy Boots Women's 7.5 B , AEROSOLES Brown Ankle Boots Looped Leather 6Mvtg BERNARD PALIANI by ROMEO MAGLI STUDDED LEATHER BOOTS FLOWERS WOMEN'S 9 RAREClarks Black Suede Meera Yew Buckle Detail Ankle Boots NEW , $199 BCBG Max Azria Womens Lexy Moc Toe Knee High Boot Shoe, Dark Caramel, US 6$139 BCBG BCBGeneration Women BG-Joesana Platform Ankle Bootie Shoe,Black,US 5.5BX753 J. K. ACID shoes black leather women ankle bootsDONALD J. PLINER Leopard Calf Fur Leather Brown Elastic Slip-On Booties Sz. 7.5M$129 BCBG BCBGeneration Womens BG-Glowe Monk Strap Bootie Shoe, Java, US 6.5 , Bare Traps Rei Ash Grey Suede Water Repellant Faux Fur Winter Boot New$199 BCBG BCBGMAXAzria Womens Ava Knee High Zipper Boot Shoe, Asphalt, US 9.5 , STEVEN BY STEVE MADDEN NEW Women's Black Fringe Zipper Knee High Boots TEDO , ROCKET DOG Womens EDMOND BURN OUT Chocolate Zip Leather Boots Size 7M , EUC Steve Madden KORBYN US 8.5 Cutout Suede Leather Boots Booties Leather BDURANGO BOOTS Ladies 8 Men 7 Cowboy Cowgirl UNISEX Western Black Leather Quilted , BCBGMaxazria Franz Leather Riding Boots Black Size 10 MSRP $395 see notesAnne Klein Devorah Women's Black Boots 9.5 , Fashion Autumn Women Shoes Party Suede Shoes Girls Sexy Thin Heels Zipper Boots3.75" Spike Heel White Stretch Patent Pointy Toe Knee High Boots Club Glam 6-12Cat By Caterpillar Bemuse Café Womens Suede Wedge Boots US 8.5 M,Emilio Pucci Womens Rainboots Size 8 38 Multi Color Rubber Pull On$140 BCBG BCBGeneration Women BG-Kaelin Suede Wedge Ankle Boot Shoe, Clove, US 7 , New West Blvd Horse Print Women Rain Boots Size 10 ,

More Stories

WOMENS LADIES THIGH HIGH OVER THE KNEE BOOTS PLATFORM HIGH HEELS SEXY NEW SIZE , Romika Women's Light Brown Leather Slip On Ankle Boots Size US 9MSAM & LIBBY womens 10 M black vegan ankle zip boots peep toe heels goth punk NEWNew Lucky Brand Yezzah Brown Suede Wedge Ankle Bootie 9.5 Casual $139 , Franco Sarto A-Formica Gray Ankle Boots Womens Size 7.5 M , Womens Trader Bay Brown Tan Leather Hiking Ankle Boots Size 9 MLadies Spot On Heeled Ankle Boots F5769New Balance Fresh Foam Grey Snow Boot Women's US Sample 8 (N3,6)Women's Minnetonka Boots - Olympia - Tan - New in Box!!Susina Womens Rawlin Wedge Bootie - Rust Suede US Size 11 , size 6.5 Carlos by Carlos San Mystify Black Heel Ankle Bootie Womens Shoes NEW , OTOT NORWALK BROWN SUEDE LADIES COMBAT BOOTS 9 M ARMY PUNK GRUNGE RIDING CHUKKA , NIB Adidas Cloudfoam QT Flex Sneaker Grey/Vapour Knitted Womens Running Shoe 6.5NEW Steven By Steve Madden Shooter Kiltie Bootie Red Leather SZ 6Comfort Flat Womens Low Heel Rivet Trim Pointy Toe Romantic Loafers Fashion shoeLadies Van Dal Shoes In Navy Patent Leather 'Anna' , Women's Via Spiga Brown Suede Ankle Boots US 6.5M Sz Excellent, Made in Italy!!!Brunello Cucinelli Monili Straps Red Leather D'Orsay Flat Shoes Sz 38 8 NWOBMarni Dark Burgundy Calf Leather Mocasín Shoes Size 41 Made in Italy , Clarks - 26110955 Womens Rosalyn Adele 7 EE Extra Wide- Choose SZ/Color.NEW Pink TORY BURCH Leather Logo BENTON Ballet FLATS Women's Shoes sz 8.5Halogen Emma Monk Strap Oxford, Black Leather, Womens Size 7 M , Womens Fly London Yaz Mousse Summer Leather Casual Work Shoes Wedge Heel US 5-11PUMA Womens Yarra Classic Wns Cross-Trainer Shoe- Pick SZ/Color. , New Balance Womens Ww928hw2 White Walking Shoes Size 6.5 (C,D,W) (286437) , New Balance Women's Fresh Foam 822v3 Trainer Shoes Blue with Purple , Nike Women's Mary Jane Brown Pink tennis shoes Size 6 Sneakers 324858-221 EUCWomen's Tory Burch flats size 6 FlatsHandmade white leather platform keds with black ties // Handmade by MDNT45 , Fila Men's Memory Faction 4 Running Shoe - Choose SZ/Color