Keep an eye on shares of Oatly (OTLY).
Its stock is down after short seller Spruce Point Capital Management accused the company of shady accounting and greenwashing. At the moment, the short seller is calling for the company’s board to hire a forensic accountant to dig through its financial claims.
As noted by Spruce Capital, “We believe investors are not focused on multiple accounting and financial control weakness which we believe have manifested in revenue and gross margin overstatement of 640bps. Our concerns are documented by former employee interviews and glaring signs of projected capex inflation running 77% higher than historical costs after Oatly has churned through three auditors in six years.
“Investors should also be concerned that its CFO and Audit Chair both obscure their roles at prior corporate accounting scandals. Oatly’s valuation has mysteriously ballooned nearly 6x since a $200m investment by Blackstone in July 2020 despite our evidence pointing to market share loss. Oatly is trading at 17x ‘21E sales and 75x adjusted gross profit and a $12bn valuation (57% of the 2025 total projected non-dairy milk market). We believe its valuation is unsustainable and will end poorly for new investors,” they added.
So far, the company has not responded to these claims.
Shares of OTLY are currently down about $1 to $20.15.