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AYI: Customer Incentives Are Growing Rapidly, Price Reductions Could Come Next

January 9th, 2023

Is anyone else tired of hearing the phrase “product vitality” from this management team?  There were 10 references to “product vitality” during AYI’s 1Q23 earnings conference call, which means if you were...

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AYI: PAA Research's 4Q22 Lighting Agent Survey - Here Comes the Slowdown

December 15th, 2022

Attached is a report outlining feedback from lighting agents across the United States. It appears the lighting industry is headed towards a significant slowdown and the pricing gains that have driven growth for the past 18-24 months are fading...

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TRUP: Trying to Solve the California Crisis - TRUP Requests a 28%(!) Base Rate Increase in CA for 2023

December 7th, 2022

“Let me map it out because I know it can be a little difficult. So we had going through the third quarter 7% rate. During the third quarter and into October, we did additional filings, which now brings what we...

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TRUP: A Broken Covenant and Now a Test of Faith

November 4th, 2022

There has been a covenant of sorts between TRUP management and the investment community, at least those that are willing to take a leap of faith on the company’s stock.  TRUP management crafted a narrative around low TAM penetration of pet insurance in the...

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EXPI: All They Do Is Miss, Dilute Shareholders, and Try to Hold the Multi-Level Marketing Scheme Together; Lowering...

November 2nd, 2022

Here are some fun facts: EXPI missed consensus EBITDA expectations in four of the past five quarters 12-months ago the consensus estimate for EXPI’s FY22 EPS was $0.78. We now estimate...

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TREX: Arrogance Is Fatal; Negative Estimate Revisions and Balance Sheet Questions Only Grow More Frequent from Here

November 1st, 2022

“You think you’re better than me?!!” Now former TREX employee to Bryan Fairbanks, President and CEO. Trex Company, Inc. (Probably) Imagine you worked for TREX at their...

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OSTK: The Waiting Is the Hardest Part in this Game of “Survive and Advance”; OSTK Shares Feel Washed Out

October 27th, 2022

“Where’s all the stores? Ain’t Dere no more!” Benny Grunch and the Bunch. WWLTV New Orleans https://www.youtube.com/watch?v=gb_dE9oKSN4 NINETEEN.  That’s the...

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UFPI: Just a Question of Timing

October 21st, 2022

Heading into UFPI’s 3Q22 earnings release, we thought the company’s quarterly results would show some early cracks and indicators of significant pricing pressure, volume deceleration, and gross margin compression to come.

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TRUP: The Four Biggest Problems Facing TRUP Right Now

October 10th, 2022

Over the past week, TRUP shares have been noticeably weak, underperforming the broader indices by roughly (-14%).  In the past we would expect a high beta, TAM/growth story like TRUP to generate 5-10% returns in a scenario in which the indices rallied...

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HUSQ.B: Falling Demand and Rising Costs; Lowering Price Objective to $50

September 16th, 2022

Attached please find a report which outlines the findings from our latest survey of outdoor power equipment dealers. We are reducing our estimates for FY23 and FY24.  We have lowered our price objective for HUSQ.B to $50, which is based on a...

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UFPI: When Every Trend Is Going Against You It’s Time to Sell; Setting Price Objective of $45

September 1st, 2022

“We believe UFPI is a great long-term investment. I don't want you to wake up 1 day and say, "I wish that Matt had told me more about that UFPI opportunity." Regret can be tough. So I'm telling you...

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TREX: An Earnings Release and Outlook Hemmingway Would Love, Lowering Price Objective to $18

August 9th, 2022

“By all measures, Trex performed exceedingly well in the second quarter.” Bryan Fairbanks, President and CEO. Trex Company, Inc. 8/8/22. 2Q22 Earnings Conf. Call If you have a “Wall of Fame”...

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TRUP: The Narrative Blew Up and the Loss Rate Spiral Could Be Upon Us

August 4th, 2022

Aside from profitless prosperity, there is one thing that TRUP management truly has mastered: narrative.  It’s absolutely remarkable that the company still has a market cap approaching $3.0B when the only thing that TRUP has demonstrated...

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CWH: Where Operational Excellence and Vision Meet Enormous Market Opportunity

August 3rd, 2022

“In our RV end market, we have seen an industry-wide restocking of dealer inventories approaching pre-pandemic levels. We are beginning to see OEM production react accordingly. We currently estimate full year 2022 RV wholesale unit...

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OSTK: If This Is as Bad as It Can Get, OSTK Could Be a Huge Winner in This Game of “Survival of the Fittest”

July 29th, 2022

Truth be told, when we hopped out of bed this morning and quickly reviewed OSTK’s 2Q22 operating results we started to gird ourselves for another day of frustration and grew worried we might see a...

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STRA: Why Is Management Lying About Lead Trends? Maybe It’s to Distract from Awful Earnings; Lowering Price Objective...

July 27th, 2022

“As I said a moment ago, we've seen a significant inflection in demand in our U.S. Higher Education segment. Inquiry volume is up more than 20% from the prior year. And within Strayer...

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TREX: An "Econ 101" Driven Cat 5 Storm of Earnings Destruction Could Be Forming

June 24th, 2022

The attached report details our short thesis on TREX and outlines the feedback we received from our latest survey of decking products dealers.

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TRUP: JAB Goes All in on Pet Insurance Which Could Accelerate TRUP’s Struggles

June 21st, 2022

Yesterday, JAB Holding Company announced the largest acquisition in the history of the pet insurance industry.  Through the transaction, JAB will acquire the Crum & Forster Pet Insurance Group and PetHealth Inc. from Fairfax...

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TREX: How Quickly Can the Channel Go From “Well Stocked” to “Stuffed”?

May 10th, 2022

TREX shares have declined nearly (-60%) thus far this year largely due to a widespread rerating of growth stocks following a near unprecedented increase in interest rates.  Remarkably, even after the enormous decline in TREX shares over...

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ATGE: Management Puts on a Brave Face as Starts Deteriorate

May 6th, 2022

Another quarter and another 20-25 minute earnings conference call where ATGE management attempted to blame COVID19 for all of their demand and operational woes.  There is no doubt that COVID19 has created a significant headwind for demand for nursing...

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CWH: Bears Swimming Against the Tide; When Estimates Go Down and the Stock Goes Up, the Short Interest Starts to Loom...

May 4th, 2022

For the past two years, we have listened to criticism after criticism of Marcus Lemonis and Camping World.   Skeptics typically bring up the following issues when criticizing Marcus, his...

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OSTK: Ten Reasons Things Will Get Better from Here for OSTK and Its Shareholders

April 29th, 2022

We lack imagination as investors.  It is the hallmark of every bull and bear market that we underestimate the upside and cannot fathom the downside for the companies in which we invest long or short.  This statement not only...

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TRUP: Not Now, Not Ever; This Is What the Start of a Broken Growth Story Looks Like

April 29th, 2022

It’s a signature of the human condition: two people can look at the same exact thing and have completely different reactions and descriptions as to what it is.  This is particularly true of works of art whose value is almost...

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TRUP: We’ll Take Your “Kuyashii” and Wish TRUP Shares “Sayonara”; TRUP Lowers Its Growth Objectives Amidst...

April 27th, 2022

Was it really only 5-months ago when TRUP shares surged to $150+ following the announcement that the company forged a partnership with the leading ecommerce platform for pet products, CHWY? ...

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HUSQ.B: No Domo Arigoto Mr. Roboto

April 12th, 2022

We introduced HUSQ.B as a short idea a few weeks ago based on our expectation that the outdoor powere equipment industry has experienced significant demand pull forward, the transition to battery powered products could dilute the company's marigns meaningfully, and demand for...

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CWH: Time to Shine

April 4th, 2022

Our latest RV dealer checks suggest industry demand remains solid while inventory levels have started to normalize. More importantly we think we are moving into an environment were the merits of CWH's strategic growth initiatives introduced over the past 2-3 years should start to shine. ...

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TREX: The Negative Estimate Revision Cycle Begins, In the Face of Unprecedented Capacity Expansion It Won’t End...

March 1st, 2022

“Fortunately, about half of the additional planned capacity has come online this month, with the balance expected by the end of January -- or excuse me, the end of April 2022. Our continuous...

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PRDO: We’ve Seen This Story Before, It’s What the Beginning of the End Looks Like

February 25th, 2022

Over the past 20 years, we have become particularly adept at identifying the early stages of a potential “death spiral” for a for-profit education company.   From a notional perspective, for-profit education...

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HUSQ.B: Time to Cut It Down

February 23rd, 2022

“This shift in relative power from manufacturer to retailer has greatly increased the relative importance of price. This increased the importance of being a low-cost producer and added urgency to our need to achieve our cost goals.” Fred Stratton. Former CEO of Briggs and...

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CWH: “Stress Test” Estimates on Dealer Productivity Suggest a Potential Earnings Floor of $3.50-$4.00/Share

February 23rd, 2022

Over the past 5-years, Marcus Lemonis and his team at CWH achieved a number of accomplishments including: Increased company revenues by more than 50% Expanded CWH’s leadership at the top of RV...

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Current Ideas

EXPI

SELL/SHORT

$4

HUSQ.B

SELL

$50

UFPI

SELL/SHORT

$45

TREX

SHORT

$18

PRDO

SELL/SHORT

$5

STRA

SELL/SHORT

$42

CWH

LONG

$75

OSTK

LONG

$128

CM

SELL/SHORT

$50

RY

SELL/SHORT

$50

ARC

LONG

$5.50

AYI

SHORT

$50

BIG

SHORT

$28

WWE

LONG

$65

XOXO

LONG

$37

RLGY

PAIR TRADE

$10

RDFN

PAIR TRADE

$30

BCO

LONG

$35

ING.PA

SHORT

$35

TRUP

SELL/SHORT

$10

CTC

SHORT

$101

ATGE

SHORT

$15

HCG.TO

SHORT

$0

RON.TO

SHORT

$9

ESI

SHORT

$0

BGG

PAIR - LONG BGG/SHORT TTC

25%

TTC

PAIR - LONG BGG/SHORT TTC

25%

Z

SHORT

$14.00

NA.TO

SHORT

$22

ZU

SHORT

$15

TRLA

SHORT

$20

MCRS

SHORT

$31

APOL

SHORT

$35

OPEN

SHORT

$30

KNL

PAIR - LONG KNL/SHORT MLHR

25%

CSGP

SHORT

$100

GCA

LONG

$8

IPSU

LONG

$20

MLHR

SHORT

$22

LOOP

PAIR - LONG CSGP/SHORT LOOP

40%

THQI

LONG

$35

WPO

SHORT

$275

COCO

SHORT

$0

HNI

SIG

RGR