Evil Knievel takes a big short on Boohoo shares as warns management will come unstuck

Dare devil bets against Boohoo's all-time high share price.
Boohoo shares have been shorted Simon Cawkwell, the trader better known by the city as ‘Evil Knievil’ due to his trading style of taking risky bets on expected share price falls that go against popular market consensus.

With the share price of Boohoo reaching new all-time highs following a 45% increase in first-quarter profits, you can see how Cawkwell earned his nickname.

The basis for the ‘substantial short’ position is underpinned by Cawkwell’s views on the way the business is governed and managed.

“I’m surprised people have not criticised [Boohoo’s management] more but they will in due course. They will come unstuck.”

Simon Cawkwell as quoted by thisismoney

He also draws reference to the damning report by ShadowFall, a hedge fund that specialises in taking short positions in companies – suggesting that the market has largely ignored it. The comprehensive report asserts that Boohoo is misleading investors on its cashflow and profits.

The report also draws reference to ISawItFirst, a fast-growing online retailer that looks incredibly similar to Boohoo and some of its brands. It is run by the brother of the chairman and major shareholder of Boohoo. This is suggested not only to show a lack of barriers to entry but could lead to an acquisition of ISawItFirst that will not benefit shareholders other than the family involved in both entities.

And the timing of this short seems compelling – reports from the Telegraph indicate that on Friday 19th June, one third of investors revolted a bumper pay rise for senior executives, including a £50m bonus for its CEO should the company reach a market cap of £6bn.

1 Comment

Click here to post a comment

Let's Talk

Argo & NasdaqThink Peter Wall gave it away in those answers. There is literally … Read More
Omega very bullishNever heard Colin so bullish before, he definitely knows good time … Read More
Getting into CBD stocksThanks I'm going to wait for MXC to dip a bit more big overra … Read More
Argo Blockchain Share Price Predi …Update. I'm not into even more profit. Am holding unless Bitc … Read More
ODX target price is?People obviously wanted to see we have a £200m contract in the bag … Read More
Hey, profit awaits! Free Sharebuyers Newsletter

Receive hot tips you can profit from - only sent when it matters. Twitter: @ShareBuyers.

error: ShareBuyers content is protected