Tilson: Long Spirit Airlines, Short Wayfair [SLIDES]

Whitney Tilson’s slides on his favorite long and short ideas from Robin Hood

Lumber Liquidators Has Collapsed

Amidst a formaldehyde scandal exposed by 60 Minutes, the stock has fallen 88% from $115.36 to $13.87
Sales and SSS are down double digits and the company is now reporting losses – trends that I don’t expect will reverse anytime soon
I believe the business is likely permanently impaired, so it remains a significant short position in my funds

Interoil Has Been More Than Cut in Half

IOC has fallen 58% from $86.50 to $36.44
My belief was (and is) that this is nothing more than a run-of-the-mill (albeit clever) natural resources promotion (natural gas in Papua New Guinea, of all places)
After more than a decade, Interoil still hasn’t produced a single MCF of natural gas – and I don’t think it ever will
I got fatigued and covered the short – but my view on the company/stock hasn’t changed a bit

Exact Sciences, My Primary Short Idea, Has Fallen 61%

The stock has fallen 61% from $24.22 to $9.39
The U.S. Preventative Services Task Force’s Colorectal Cancer Screening Draft Recommendation issued recently is devastating for Exact Sciences’ only product, Cologuard
I think this is the beginning of the end for the company.
My price target for the stock a year from now is $3, so I shorted more last month ~$10

Even Though the Stock Had Been Cut in Half, I Pitched Lumber Liquidators Again

Lumber Liquidators Subsequently Collapsed an Additional 76%

Though it had already been cut in half (from $115.36 to $57.63) since my first presentation, it was still a fantastic short, as it’s since fallen another 76% (from $57.63 to $13.87)
A good lesson on not falling into the “I missed it” trap – you hadn’t missed it
What the definition of a stock down 90%?
Answer: A stock down 80%…that then gets cut in half!

See full slides below.