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Citron's Andrew Left Explains His Latest Trades

Citron's Andrew Left Explains His Latest Trades

Citron Research's Andrew Left is doing what every investor should do — take profits off the table when they can.

Left initiated a short position in NVIDIA Corporation (NASDAQ: NVDA) in the final trading days of 2016 and confirmed on CNBC's "Halftime Report" segment on Friday that he closed his short position and used the proceeds to add to his already short stake in Mobileye NV (NYSE: MBLY).

Left believes that Mobileye's stock will drift toward the $35 level in the short term as the company is not only a "one-tick pony," but its own insiders are very active in selling their personal stakes in the company.

Left did acknowledge that Mobileye was a first-mover in the autonomous driving space, but that was then and this is now.

"Those first million miles that they acquired were very valuable and that's why they were able to go IPO," Left explained. "But since then everyone has caught up to them. Their management even knows it — just look at the amount of sales."

Left also noted that Mobileye's management team said that the company needs to invest more in R&D initiatives, but this is something "they should have thought about two years ago."

See Also: Wayfair's Q4 Reinforces Andrew Left's Short Thesis

Don't Confuse Autonomous Driving With ADAS

Left fielded a question from CNBC's Pete Najarian who pointed out that Mobileye commands a 70 percent market share in the autonomous driving space.

The short seller was quick to respond that Mobileye commands a 70 percent market share not in the autonomous driving space but in the Advanced Driver Assistance Systems space.

Left further explained that while Mobileye is indeed showing strong revenue growth today investors need to look at the bigger picture and long term. Unfortunately, the Israel-based company is "not even close" to being a leader in the autonomous driving space.

Finally, Left pointed out that every deal Mobileye has with either an original automaker or a technology giant like Intel Corporation (NASDAQ: INTC) is far from exclusive and Nvidia holds similar deals of its own.

"For everyone who thinks that Mobileye owns the future of autonomous driving is an un-informed person," Left emphasized.


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