05:10:13 EDT Thu 28 Mar 2024
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Lonestar West Inc
Symbol LSI
Shares Issued 29,457,549
Close 2016-11-14 C$ 0.445
Market Cap C$ 13,108,609
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Globe says Badger short-selling argument is weak

2016-11-14 05:45 ET - In the News

See In the News (C-BAD) Badger Daylighting Ltd

The Globe and Mail reports in its Saturday edition that Badger Daylighting has garnered the attention of short sellers. The Globe's Fabrice Taylor writes that more than a quarter of Badger's stock has been borrowed and sold into the market by hedge funds hoping the company stumbles. Mr. Taylor's money is on the long investors. He says the shorts could be in for serious financial trauma. A couple of weeks ago, Barron's ran a story saying Badger's stock could fall more than 30 per cent. It was obvious that a short seller had whispered the story into the writer's ear. Barron's cited a slowdown in the oil patch as one reason for its bearish view. Barron's also questioned the company's valuation and cast doubt on its accounting. Mr. Taylor believes Barron's argument is weak. Barron's says the stock trades at rich multiples that are higher than its peer group, which consists of only a few players, including Lonestar West and Clean Harbors. The peer group is small, however, and Badger is the first mover, biggest player and market leader. Mr. Taylor says valuation is typically not a great reason to short a stock. Mr. Taylor believes the shorts have dug themselves a hole that will cost a lot to get out of.

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