'The stock market has sucked on nitrous oxide' -- Wall Street's most feared short seller just called out a new company, taking a big bite out of its stock

  • Short seller Andrew Left, founder of Citron Research, was up to his old tricks on Thursday, singling out medical-technology company Inogen as overvalued.
  • The combination of his report and its accompanying tweet sent Inogen’s stock tumbling as much as 9%.
  • It’s just the latest example of Left’s ability to wipe out billions of market value from a company, which he’s earned over time with a series of prescient calls.

One medical-technology company just found out the hard way what’s it like being on Andrew Left‘s radar.

Left, the notorious short seller and founder of Citron Research, published research on Inogen around mid-day Thursday, and it immediately sent shares tumbling.

Inogen dropped as much as 9% in a roughly 15-minute span amid Citron’s full-court press, which included a series of tweets accompanied by the eight-page report. The stock has since pared the loss and was trading about 1% lower as of 2:15 p.m. ET.

Left’s core argument is that while Inogen has been successful in tapping into the booming market for portable oxygen concentrators, its stock has become wildly overvalued as investors overlook the potential for value-crushing competition.

For context, Inogen has surged 45% this year, compared to a 2.2% return for the benchmark S&P 500.

“While Wall Street was busy looking at the growth of this high-flying med-tech company, no one looked under the hood to find a future that is guaranteed to have price compression and competition,” said Left. “The stock market has sucked on nitrous oxide and made this the most expensive company in either med-tech or medical supplies and definitely removed Inogen from any relation to the valuation of its peers.”

The immediate market move seen in Inogen is just the latest entry into Left’s storied history as a market-moving short seller. With as little as a single tweet simply teasing a report, he’s shown himself capable of wiping out billions of dollars of market value from a company.

Past targets of Left’s have included Express Scripts, which he said in December 2016 could be targeted during the Trump administration, and The Chemours Co., a DuPont spin-off he warned might be bankrupted by a class-action lawsuit.

But Left is perhaps best known for his damning October 2015 report that accused Valeant Pharmaceuticals of being a “pharmaceutical Enron,” and he helped bring up questions regarding the firm’s accounting and relationship with the specialty pharmacy Philidor.

Read the full Citron Research report here

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