David Einhorn’s Greenlight Capital released their investor letter for the first quarter today, and as expected—stocks mentioned in the letter are making moves.
Einhorn was critical of his most famous short these days—Green Mountain Coffee—but also took time to renew his scepticism with the value of Florida real estate developer St. Joe’s Company. Einhorn made headlines when he publicized his short on St. Joe’s in 2010 and engaged in a very public fight with mutual fund manager Bruce Berkowitz, who is the majority shareholder of the company.
And investors seem to believe Einhorn’s renewed emphasis on the weakness of St. Joe’s—the stock has fallen nearly 6% today since the letter was made public.
In his letter, Einhorn said he doubted the effectiveness of the company’s new 2012 business strategy, which he says is vague and hard to understand. In addition, he pointed to the fact that the best pieces of land owned by St. Joe’s have already been sold or developed, and what is left are lands under conservations laws that cannot be used and thus have very little underlying value.
Judging from the market, it looks like Einhorn: 1, St. Joe’s: 0 right now. We’re waiting for the company (and maybe Florida based investor Bruce Berkowitz) to strike back.