Market Overview

Kerrisdale Capital Confirms It Is Shorting Shares of Globalstar, Inc.


Kerrisdale Capital announced last week that it will reveal its “best short” idea on Monday. Rumors quickly circulated that Kerrisdale Capital would reveal a short position in Globalstar, Inc. (NYSE: GSAT), rumors which turned out to be accurate.

On Monday morning Kerrisdale Capital released a report describing Globalstar as "the most egregious $4 billion stock promotion since Sino-Forest."

"Globalstar's equity is worthless," Kerrisdale Capital wrote. "It is not worth $4 billion, or $3 billion, or $1 billion. It is worth nothing, and it takes little more than a rudimentary understanding of wireless communications to realize that."

According to Kerrisdale Capital, Globalstar's Perrestrial Low Power Service concept is "laughable" and will never be commercially viable. Globalstar's spectrum holdings are "unlikely" to generate material value in any other use case.

"Like its satellites, Globalstar's stock price has a long, long way to fall before crashing back to earth."

Shares of Globalstar traded as low as $2.45 and popped higher to $3.42 following Kerrisdale's announcement as traders likely began covering previous short positions. Share were last down 6.3 percent at $2.82.


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Posted-In: Globalstar Kerrisdale CapitalNews Movers