Heska sinks to 4-mnth low as Spruce Point recommends "strong sell"

Heska

25/10/2021 16:04

** Shares of Heska  HSKA.O , which sells veterinary
diagnostic and specialty products, down 4% at $219.6 after
short-seller Spruce Point issues a "strong sell" recommendation
on the stock
    ** Stock hits lowest level since June 11
    ** Spruce Point sees 50%-60% downside risk to the stock,
implies HSKA should trade at $90-$115/share
    ** Spruce Point says the co has overstated its market share
gain since 2013 and an analysis of recent acquisitions show a
pattern of buying low-quality assets 
    ** "When we assign the deal values to the acquired
businesses, we find that the market is valuing Heska's North
American business at 17.5x revenue, on par with vastly superior
market leader IDEXX Laboratories," Spruce Point analysts write https://www.sprucepointcap.com/heska-corp
 in a note
    ** Stock up 51% YTD 

 (Reporting by Sruthi Shankar)
 ((sruthi.shankar@thomsonreuters.com;))