})(); Check out our cornerstone topics which we update regularly by clicking below. 2. Based on the near total faking of users, we assume that the fraudulent portion of GSX's revenue is at least equal to the percentage of fraudulent users, although it would not surprise us if the ASP on the real portion of GSX Techedu's business is fraudulently inflated too. GSX Techedu … Please speak to a licensed financial professional before making any investment decisions. The markets simply cannot decouple from the financial sector for any sustained period of time. var r = Math.floor(Math.random() * (9999 - 0 + 1) + 0); On May 18, research firm Muddy Waters told the world it was short GSX Techedu stock. It's completely caused by the shift switching in the live room. Charlie Munger is one of the world's greatest investors. Without users, there is no revenue. As you can see, the ratio is at its lowest level ever, 0.074 ($21.59 divided by $291.97, as of yesterday's closing prices) – even lower than it was at the depths of the global financial crisis... And here's a chart showing XLF and SPY over the past three months. 4) This New York Times article echoes what my friend said: China's Factories Are Back. I have been told that the south part of the city, known as Wujin, is the richest area in all of China. I have been very busy with work and I have not been out shopping in a month, so I have no idea what is going on at the malls. 1)For the accusation that "the users are at least 80% the robot", Shen Nan, GSX's CFO, explained that it has nothing to do with the robot. Over the past six decades, he's helped his business partner and friend, Warren Buffett, turn a struggling textile business called Berkshire Hathaway into one of America's largest firms. 3. I should put this in the context that Changzhou where we live is a "rich" city. I have never seen our industrial park this busy. My wife has been out of town on business and commented in her travels she observed that retail is hurting. 5) On April 2, shares of China's Luckin Coffee (LK) collapsed by 76% to $6.40 after the company admitted that it's investigating "fabricated sales" that could total more than $300 million, and said its prior guidance and sales figures from the second quarter of 2019 to the fourth quarter of 2019 are no longer reliable. document.getElementsByTagName('head').appendChild(jo); jo.src = 'https://www.financialjuice.com/widgets/voice-player.js?mode=inline&display=1&container=FJ-voice-news-player&info=valuewalk&r=' + r; May 18, 2020 Muddy Waters (MW) issued a report; "MW is Short GSX Techedu Inc." concluding that GSX was a near-total fraud. GSX said that the short report is confused and full of ignorance about the company's business. On April 20, he wrote: In 2008, the banking industry was essentially bankrupt and somehow they are now priced lower against earnings power, tangible book value, or as percent of deposits relative to the condition that existed 12 years ago. We downloaded GSX's data from more than 200 paid K-12 classes covering 54,065 unique users. On May 18th, we published our research on GSX in which we concluded that at least 70% of GSX’s purported users are fraudulent, and quite likely the real percentage of fake users is over 80%. We won't send you spam. Long holders of GSX face the risk that the margin lenders will be forced to aggressively sell the stock, crashing the price. We conclude that GSX is a massive loss-making business. We also conclude that GSX greatly understates expenses. Mission: Providing a framework to improve your investing PROCESS, while collecting newsworthy information about trends in business, politics and tech areas. It can seat probably 150 people and we were the only ones there for the entire time it took to finish our food. If there is a slowdown – you can't tell by looking here. Either financials are way too cheap, or everything else is too expensive, or both! Its Consumers Aren’t; Luckin Coffee is trading again; Muddy Waters is short GSX Techedu.
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