Proofpoint Crashes Following Muddy Waters New Short Idea

Shares of Proofpoint Inc PFPT plummeted early Thursday afternoon following a tweet from noted short-seller Muddy Waters.

The firm said Proofpoint has an exaggerated total addressable market, "fudged organic growth, competition eroding pricing power, heavy insider sales."

Muddy Waters presented the idea at the Sohn London Investment Conference, which is taking place all day Thursday.

Proofpoint Chairman Eric Hahn sold 15,000 shares according to a Form 4 Filing released Wednesday at 9:48 p.m. ET. The transaction took place on November 25.

Shares of Proofpoint dropped more than 11 percent immediately following the tweet, which was posted at 12:56 p.m. ET. Shares hit a low of $62.47 before edging back up. The stock traded recently at $69.39, down about 4.8 percent.

The stock was trading steady all morning, with its day-high sitting at $73.59.