athenahealth CEO said he pulls numbers 'out of his a--' on video and David Einhorn put it in a devastating presentation

Greenlight Capital CEO David Einhorn presented his short thesis for athenahealth at the Grants Investment Conference last week, and the most eye-popping slide is a video clip of the athenahealth’s CEO explaining how he calculates its growth expectations.

“‘Well how did you get to your 30% organic growth?’,” athenahealth CEO Jonathan Bush said to a panel of laughing listeners. “I said I dunno. I got it out of my arse.”

Einhorn has been publicly short athenahealth since May of 2014. In last week’s presentation, he covered a wide range of topics — from monetary policy to European debt — but really dug into what’s going on at the medical records company.

We’ve included that part of the slide deck here.

“At the Ira Sohn conference last year, we allowed relatively generous assumptions in the base case DCF, which valued athena at $US50 per share,” Einhorn said in closing. “Back then, we weren’t forecasting a big slowdown in enterprise bookings, massive increases in capitalised research and development propping up the income statement, or Epic entering the cloud. As it stands now, we think athena’s business performance is tracking closer to our bear case valuation of $US14 per share. We continue to expect the athena stock bubble to pop.”

Einhorn first announced that he was shorting athenahealth last May, and he's still short.

athenahealth is a web-based physicians billing platform.

It's entering the inpatient/hospital market.

The stock has gone nuts, but the fundamentals of the company haven't improved.

Analysts love it.

'Essentially we see it as a business process out sourcer, with a very promotional CEO,' Einhorn wrote of athenahealth CEO Jonathan Bush.

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Greenlight doesn't think the rest of Wall Street has anthenahealth's numbers right.

Greenlight's bear case sees headwinds.

It's got competition.

The stock hasn't really moved much.

'Like many companies, athena has learned that if Wall Street counts cash compensation but not stock comp, it may as well pay its people in as much stock as possible.'

athenahealth doesn't have the cash to cover its expenses.

'athena tells investors to ignore current profits because it needs to invest to maximise its growth opportunity.'

The company is showing some signs of strain.

'We grow on average 30% a year,' Bush said in this interview. 'I think the clinical term for that is it doesn't suck.'

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athenahealth missed that 30% goal in 2014.

athenahealth isn't that transparent about its bookings, but we can make some good guesses.

'The green line is our sense of what 'a little short' might mean,' Einhorn wrote.

The contracts just aren't there.

Enterprise took a nose dive.

But that 30% expectation is still there.

'athena might cheer 30% enterprise bookings growth, but that won't even take it back to its 2011 level.' Einhorn wrote.

It won't hit 2013 booking levels either.

The booking decline will really start to hurt in 2015 and 2016.

'What I said last year was... 'Well how did you get to your 30% organic growth?' I said I dunno. I got it out of my arse,' says athenahealth CEO Jonathan Bush in this video.

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Customers are walking away.

The brand's image isn't doing so hot either.

''So this is the key. We're not going to develop a system to take them on,' Bush said when questioned about his competition. 'We are building a network.'

Meanwhile athenahealth is acquiring companies.

'It's very forgiving to buy companies,' Bush said. 'The accounting is very forgiving.'

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Bush has trashed Epic's business model.

But now Epic is teaming up with Apple.

And athenahealth board members (aside from Bush) have sold 58% of their stock in the last year.

'I don't know what we're worth... I know we're worth $1,000 a share, no problem, sometime in the future,' Bush old Bloomberg TV.

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