Citron Research's Andrew Left, who gained notoriety for successful bets against companies such as Valeant Pharmaceuticals, on Monday posted a bearish report on Ubiquiti Networks.
Shares of Ubiquiti plunged 8 percent after the short seller released his report. The company makes wireless networking products and its CEO is Robert Pera, majority owner of the Memphis Grizzlies.
Tweet Link
"Citron believes Ubiquiti story is unraveling as we write," Left wrote on his Citron Research website. "The end is now for the Ubiquiti Fraud. What was once a company with unique products in a fragmented space has turned into a company that sells products in highly competitive markets where they are the last mover."
A company spokesperson officially declined to comment on the Citron report, but Pera replied to the Citron tweet with his own, saying, "My apologies to those affected by these clowns."
Tweet Link
Ubiquiti will have an investor update featuring Pera on Sept. 26.
The short seller also questioned the company's use of distributors saying, "Ubiquiti's financials don't reconcile with its distributors." He also cited how Morgan Stanley recently dropped research coverage of the company.
"Like many of the frauds that Citron has uncovered in the past, the cash balances claimed by Ubiquiti do not generate reconcilable interest income," he wrote.
When asked if he is short the stock by CNBC, Left replied in an email, "What do you think?"