Another Noted Short Seller Calls Netflix (NFLX) CEO's Letter "Extremely Irregular and Disrespectful"
Netflix (Nasdaq: NFLX) CEO Reed Hastings' strange move today to address short seller Whitney Tilson is creating quite a buzz on Wall Street today.
While Whitney Tilson was unavailable to comment on Hastings' letter, another noted short seller, Manuel Asensio, had some harsh things to say about the matter.
Asensio told StreetInsider.com "I find it extremely irregular and disrespectful."
He calls the letter from Hastings, "reflective of the poor and questionable discloser which has led to the informational insensitivity of the stock."
Asensio describes informational insensitive stocks as those that don't respond to prevailing Wall Street opinion. In the case of Netflix, the prevailing logic is that the stock is overvalued, yet the stock does not respond to this wisdom and keeps going higher. Even CEO Hastings himself described the valuation of the stock in his letter today as "substantial."
Mr. Asensio called it the responsibility of the Board of Directors to monitor Mr. Hastings irresponsible actions in this matter and in others. He said Mr. Hastings' wording in the response was custom tailored to create a short squeeze in the stock.
Mr. Asensio reiterated his view, expressed in a recent CNBC appearance, that the company can never make the fictitious Wall Street estimates. He also promised to become much more involved in the stock.
Shares of Netflix are down 1.3 percent today to $177.67.
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While Whitney Tilson was unavailable to comment on Hastings' letter, another noted short seller, Manuel Asensio, had some harsh things to say about the matter.
Asensio told StreetInsider.com "I find it extremely irregular and disrespectful."
He calls the letter from Hastings, "reflective of the poor and questionable discloser which has led to the informational insensitivity of the stock."
Asensio describes informational insensitive stocks as those that don't respond to prevailing Wall Street opinion. In the case of Netflix, the prevailing logic is that the stock is overvalued, yet the stock does not respond to this wisdom and keeps going higher. Even CEO Hastings himself described the valuation of the stock in his letter today as "substantial."
Mr. Asensio called it the responsibility of the Board of Directors to monitor Mr. Hastings irresponsible actions in this matter and in others. He said Mr. Hastings' wording in the response was custom tailored to create a short squeeze in the stock.
Mr. Asensio reiterated his view, expressed in a recent CNBC appearance, that the company can never make the fictitious Wall Street estimates. He also promised to become much more involved in the stock.
Shares of Netflix are down 1.3 percent today to $177.67.
Get immediate access to market moving news and alerts with StreetInsider.com Premium - FREE TRIAL!
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These short sellers have weak arguments.
Rob on Dec 20, 2010 03:38 PMMark as Spam
It is disrespectful for Mr Hastings to have an opinion ? He is being disrespectful by calling Whitney Tilson "a great investor and a wonderful human being ?" Rick Aristotle says "this netflix backlash is ridiculous " and apparently it's cool to trash netlix again. " In an article in The Motley Fool by Brian Pacampara he writes "on CAPS, 19% of the 8,433 members who have rated Netflix believe the stock will underperform the S&P 500 going forward." Mr Pacampara, you are supposed to put the strong part of your argument early in your article and a small minority (19%) believe Netflix stock will underperform. Your reasoning underperforms. The Wall Streat Journal said that Netflix is so far ahead of Google and Apple in streaming that Google and Apple had better not even bother to suit up for battle.