Latest news with #Chanos
Yahoo
16-07-2025
- Business
- Yahoo
Jim Chanos Calls Strategy's Premium 'Financial Gibberish'
Jim Chanos, the founder of Kynikos Associates who famously shorted U.S. energy giant Enron before it collapsed in 2001, has set his sights on Strategy (MSTR), arguing the bitcoin (BTC)-buying company's premium valuation over its holdings of the largest cryptocurrency is unjustified. Chanos has placed a bet against Strategy's stock by shorting it while maintaining a long position in bitcoin itself, aiming to profit if the company's premium valuation shrinks. In shorting, a trader borrows stock, sells it and hopes the price falls enough for them to buy it back in time to return to the lender while leaving them with a profit. The investor has earned a reputation for spotting corporate frauds and overvalued companies. Enron, once a major U.S. energy firm, collapsed amid massive accounting fraud, wiping out billions in value and sending top executives to prison, becoming a lasting symbol of corporate scandal. He criticized the financial maneuvers of Strategy Executive Chairman Michael Saylor, who has sold convertible debt and preferred shares to raise money to buy more bitcoin, calling them 'financial gibberish' and warning that the sales create risks for shareholders. Strategy has accumulated more than 600,000 bitcoins, far surpassing its closest competitors. In a debate on the We Study Billionaires podcast, Chanos clashed with Pierre Rochard, CEO of Bitcoin Bond Co. and a well-known bitcoin advocate, over Strategy's roughly 1.9 times net asset value premium. According to Chanos, the company offers nothing unique beyond owning bitcoin, and contends the premium should disappear as more than 140 other firms worldwide, including MARA Holdings (MARA), Riot Platforms (RIOT) and Metaplanet (3350), pursue similar treasury strategies. Rochard, however, sees Strategy's large bitcoin stash and first-mover advantage as key strengths. He argued the company can raise significant debt without diluting shareholders and that investors view Strategy as a leveraged play on BTC, akin to holding a call option for potential upside. Rochard also suggest that crypto-friendly policies under the administration of President Trump could attract more investment into the industry, boosting Strategy's appeal. While Chanos insisted direct bitcoin ownership is safer and simpler, Rochard countered that Strategy's size enables it to leverage more efficiently than individual investors.
Yahoo
04-07-2025
- Business
- Yahoo
Wall Street's hottest debate pits Jim Chanos against Michael Saylor
One of Wall Street's most prominent skeptics, short seller Jim Chanos, is ramping up his criticism of Wall Street's most popular bitcoin trade: Michael Saylor's Strategy (MSTR). 'It makes kind of no sense,' Chanos said in a recent interview on Bloomberg's "Odd Lots" podcast, the latest in a series of public comments taking aim at the market frenzy surrounding Saylor's company. Saylor has turned a business intelligence software firm into a bitcoin juggernaut by using a combination of debt and equity to add tons of the world's largest cryptocurrency to his company's balance sheet. Strategy now holds 597,325 bitcoins worth roughly $64 billion as of June 30, making it the largest corporate holder of the digital asset. And the stock of his company has soared 210% over the past year — well above the 80% gain of bitcoin itself as well as a 13% gain for the S&P 500. The main concern about all this, which Chanos continues to hammer home in TV appearances and podcasts, is that Strategy should not be valued higher than the underlying asset it owns, and that investors should simply buy bitcoin instead of stock in a company buying bitcoin. Chanos's views carry weight on Wall Street. He has made a career out of betting against companies he believes are wrongly valued, and is most famous for predicting the downfall of Enron in 2001. Saylor's counterargument to Chanos's skepticism is that shares of Strategy are easier to own and buy than bitcoin or bitcoin exchange-traded funds due to compliance and regulatory rules. Proponents of his approach also argue that Strategy's stock trades at such a rich price to bitcoin because investors believe the company will continue to suck up more of the asset's finite supply of 21 million units. 'If you want to 10x your money, you buy bitcoin,' Saylor said in May at a conference convened to show other firms how to adopt his so-called 'bitcoin treasury' strategy. 'If you want 100x your money, you buy bitcoin with someone else's money. If you want to 1000x your money, you buy bitcoin with someone else's money and then you leverage the bitcoin.' The escalating war of words between Chanos and Saylor has captivated Wall Street as the two lob shots at one another via interviews with TV networks such as CNBC and Bloomberg. 'I don't think he understands what our business model is,' Saylor has said of Chanos, predicting that 'if our stock rallies up, he's going to get liquidated and wiped out.' Chanos has said of Saylor that he 'is a wonderful salesman, but that's what he is: He's a salesman … I call it financial gibberish.' Neither Chanos nor Saylor responded to Yahoo Finance requests for comment. So far in 2025, bets against Saylor have not worked out. Investors betting against Strategy over the last month have seen $3.6 billion in losses, according to short seller data provider S3 Partners. Chanos isn't Strategy's only critic. Investors filed two separate lawsuits in May and June in a federal court in Virginia, both of which included allegations that Strategy misled them about how the volatility of bitcoin could affect the stock. Some analysts have also raised concerns. Monness, Crespi, Hardt & Co analyst Gustavo Gala said in a recent series of notes to clients that Strategy's premium will likely come down as fixed income investors have shown limited interest in the company's convertible debt and preferred shares used to fund its bitcoin purchases, writing in early June that Strategy has 'a limited runway' to continue its approach. Gala noted that there is a growing concentration of companies pursuing a 'copycat BTC Treasury Strategy.' Dozens of other companies, from a media firm controlled by President Trump's family to meme stock poster child GameStop (GME), have piled into bets similar to the blueprint laid out by Saylor. And 'all of these compete for an ostensibly similar pool of capital,' Gala wrote in a note Tuesday. Over the first half of 2025, public companies collectively added 245,191 bitcoins to their balance sheet, more than twice as much as bitcoin holding ETFs over the same period, according to data provider Bitcoin Treasuries. The latest big name to enter the crypto treasury game is Fundstrat founder Tom Lee, who is joining bitcoin mining firm BitMine Emersion Technologies (BMNR) as chairman after joining several institutions in helping this company raise $250 million to launch an ether (ETH-USD)-focused treasury strategy. BitMine's stock price has taken off since the June 30 announcement, climbing more than 30 times its pre-announcement price of $4.26. Short sellers have had far better luck betting against imitators of Saylor as opposed to Saylor's actual company. For the month of June, they earned $549 million betting against four of Strategy's largest imitators, according to S3. David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance. His email is at Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-06-2025
- Business
- Yahoo
Bank stocks pop, Strategy & bitcoin, Google's nuclear play: Trending Tickers
Bank stocks, including Goldman Sachs (GS), Bank of America (BAC), and JPMorgan (JPM), rise after passing the Federal Reserve's stress test. Strategy (MSTR) buys another $532 million in bitcoin (BTC-USD). Alphabet (GOOG, GOOGL) will buy power from Commonwealth Fusion Systems, doubling down on its investment in nuclear energy. To watch more expert insights and analysis on the latest market action, check out more Market Domination here. Now, time for some of today's trending tickers. We are watching bank stocks, strategy and Alphabet. Let's dive in. First up, bank stocks are rising after passing the Federal Reserve's annual health check. The Central Bank says 22 of the largest US banks are well positioned to withstand future economic downturns. This clears the way for lenders to boost buybacks and dividends for shareholders. A Fed official says that the banks are expected to announce buyback plans on Tuesday. Raymond James says the stress test results should garner increasing investor interest in financials. And Wells Fargo is naming Goldman Sachs as the big winner, along with JP Morgan, Bank of America and M&T Bank. Uh perhaps should come as no surprise. Those are the largest banks and with the best positioning, perhaps to pass some of these stress tests. Right. So JP Morgan and Bank of America are two family favorites. I own them. I own them both. The others I don't, but you're right. This will uh this passing of the tests is going to just is going to uh uh allow investors to get even that much more confident once these banks start to announce these buybacks and raise their dividends. You'll see money flowing into it and with earnings just starting two weeks away, kick again, kick off with JP, all these big banks will kick off on the 15th. Um I suspect that we're going to hear some very positive forward guidance from these companies. Yeah, and just a reminder is context to our viewers, why these stress tests are so important. Essentially solidifies that the banks would have enough liquidity if there were a run on the bank. On the bank. And so, that's exactly why these are even more important, securitizing some of that investor interest as well. Right. And investors should look to have those big names, exposure to those big names. Michael Oh, excuse me. Next up, Michael Saylor's strategy is once again buying Bitcoin using common shares despite coming under fire for the practice by renowned short seller, Jim Chanos. Strategy purchasing nearly 300 or $532 million of Bitcoin in the last seven days ending June 29th. Now, Chanos uh Chanos argues strategy's business model doesn't make sense and the stock is overvalued. Saylor is arguing that Chanos doesn't understand the process here. And so, uh maybe kind of signaling what the Sixers have told me and sold me for a while and trusting the process here. Um but understanding the process and the difference in strategy from formerly known as MicroStrategy, now strategy and of course, friend of the show, Michael Saylor, who has joined us time and time again to really walk us into what their purchase patterns would look like in the future. Very bullish on Bitcoin and they've stayed that way and not wavered. Look, I I think everyone's entitled to an opinion and a strategy on how they design it and what they think their future is. It's okay to have a difference of opinion. Chanos thinks it's wrong. He thinks, Saylor thinks it's correct. Certainly, it is proven, you know, Saylor strategy has proven to be a winner. Um so, it's okay to have an argument, but I don't think you can throw all your, you know, your cards in the same pile as Jim Chanos that I know it's wrong. I don't necessarily think it's wrong at all. The world is changing, right? It is, and it's even prompted some of the other publicly traded companies to consider where they also need to add on Bitcoin to their balance sheet. I.e., look no further than GameStop that hit the strategy button just weeks ago here, announcing that they were buying, I think it was at the time, 4,710 Bitcoin. And so, we'll see how they continue to add on to a position. Correct. Right. Also here, we're also tracking alphabets today, making a play in nuclear fusion. Now, the tech giant says it will buy electricity from a future fusion power plant in Virginia. This is power that's never successfully been used anywhere in the world yet, but the plant being built is called Commonwealth Fusion Systems and grew out of research at MIT. Fusion could help meets the demand for energy things for things like AI and data centers and EVs. Google going to be increasing its existing equity investment into Commonwealth beyond the $2 billion the company has already raised here. Shares right now are down on the day, but there are always a myriad of different headlines circling around Alphabet and Google, but this is pretty significant here. And you actually pointed out another stock as well that is hot within the space this year. Yeah, new scale, the symbol is SMR, right? But they do these small modular reactors, right? These nuclear reactors that are really designed to help power all these things that you're talking about, data centers, EVs and all that stuff. And I actually think that's going to be where a lot of these data centers find their energy coming from is going to be from uh from this clean energy. Interesting. Yeah, and that stock that you pointed out, SMR, it's up year to date 118%. Yeah, it's had a fantastic move. Absolutely. You can scan the QR code below to track the best and worst performing stocks of the session with Yahoo Finances Trending Tickers page. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Mint
30-06-2025
- Business
- Mint
Chanos Warns of AI Pullback, ‘Absurd' Bitcoin Treasury Companies
(Bloomberg) -- Enthusiasm for all things artificial intelligence has helped propel stocks to another all-time high, but the AI ecosystem is getting close to a potential pullback, warned legendary short-seller Jim Chanos. The founder of Chanos & Co. likened the dominance of AI companies to networking giants such as Cisco and Lucent which characterized the market of the 1990s and saw their stocks soar as companies upgraded their systems to handle the new internet age. At a live recording of the Odd Lots podcast in New York, he cautioned that a potential pullback in demand from corporate customers for AI-related goods and services could spark a contraction in both corporate earnings and economic growth. The risk is that customers who are spending billions of dollars on everything from data center space to semiconductors could end up unexpectedly curbing their capital expenditure. In the early 2000s, at the height of the Technology, Media, and Telecommunications (TMT) bubble, companies like Cisco and Lucent saw their massive order backlogs suddenly evaporate and their valuations plummet. Now, with some signs of a slowdown in the labor market and potential disruptions from tariffs, it's possible that big corporate customers cut back on their spending plans once again. 'There is an ecosystem around the AI boom that is considerable as there was for TMT back in '99 and 2000,' Chanos said. 'But it is a riskier revenue stream because if people pull back, they can pull back CapEx very easily. Projects can get put on hold for six months or nine months, and that immediately shows up in disappointing revenues and earnings forecast if it happens.' 'We're not there yet, but that's one of the risks out there that I think a lot of people are underestimating,' Chanos said. As stocks surge, Chanos has been warning of other market absurdities including the proliferation of Bitcoin treasury companies which raise money to buy and hold the cryptocurrency. He's been beefing with Michael Saylor, founder of Strategy, in a high-profile dispute over the value of the company. Strategy's market cap of more than $100 billion far outstrips the roughly $60 billion value of the cryptocurrency on its balance sheet. Saylor has justified Strategy's lofty valuation by arguing that the company's ability to raise funds at a premium essentially means its business model is 'risk-free.' 'There's a wonderful sales job that's being done about the fact that this is an economic engine in and of itself,' Chanos said. 'And so therefore, terms like 'Bitcoin yield' are used and I've called them financial gibberish because they are.' When asked for his thoughts on Tesla Inc., whose stock Chanos has previously shorted, he drew on the Cisco parallel once again. 'There's always one stock in every bull market that has that, at least that imprimatur of, I call it hopes and dreams,' he said. 'Everyone can really project their hopes and dreams onto that company and then value it any way they want. And Cisco was that company, by the way, in '99. And [now] it's undoubtedly Tesla.' 'You could see Elon robbing a Brinks truck with a mask on or whatever [and people would say] 'Oh, that's Elon. I'm sure they're going to have a new business of robbing Brinks trucks. And we'll put a trillion [dollar] valuation on that,' he said. More stories like this are available on
Mint
20-06-2025
- Business
- Mint
AQR's Cliff Asness Sides With Jim Chanos in Critique of Michael Saylor's Strategy
Bloomberg Published 21 Jun 2025, 01:26 AM IST (Bloomberg) -- AQR Capital Management's Cliff Asness says he's in agreement with famed short seller Jim Chanos when it comes to his criticism of Strategy founder Michael Saylor's claim that the use of convertible debt affords the leveraged Bitcoin proxy downside protection while continuing to accumulate the cryptocurrency. The critique is centered around whether there is 'recourse' for the company formally known as MicroStrategy Inc. to pay back holders of its convertible bonds, through which Strategy raised roughly $10 billion to fund Bitcoin purchases. While Saylor said this type of debt 'is not going to get called' and can be paid off with stock if the price of Bitcoin tumbles, both Asness and Chanos disagreed. In a Friday post on social media platform X, Asness said Chanos 'is of course right.' It is yet another twist as the back and forth between Chanos and Saylor is becoming a Wall Street battle for the ages. In separate Bloomberg interviews last week, Chanos said the Saylor's model to value the crypto-treasury firm is 'financial gibberish' while Saylor argued that Chanos just does not understand it. Earlier, Chanos recommended an arbitrage trade to short the shares of Strategy and buy Bitcoin, betting the large premium the stock commands over the value of its token holdings will shrink. Shares of Strategy were little changed on Friday, and have risen 27% so far this year. The stock had surged more than 3,000% since Saylor began buying Bitcoin in the middle of 2020. More stories like this are available on
