Sahm Adrangi, along with his private investment firm, Kerrisdale Capital, has recently put out a negative report that explains why it is shorting QuinStreet Inc, which is an internet marketing company. QuinStreet Inc. has seen its stock price increase by 400% recently, and those who have invested in the company believe that this move is signalling a bull run that is about to happen for QuinStreet Inc. Instead of going along with these stockholders, Kerrisdale Capital and Sahm Adrangi are sharing that they believe the long-term success of the company is in serious question because the business has mainly been improving due to phony traffic that has been going to the company’s network of websites.
Sahm Adrangi pointed out that these websites earn money for the company when users take actions there like filling out a form or clicking a link. This truly only benefits QuinStreet Inc. and takes away from its base of clients. In fact, Kerrisdale has been quick to let people know that the increase in revenue for QuinStreet has disproportionately come from one client and that the market should be taking this into account. In general, Adrangi finds that QuinStreet is shoddy company that is using an unsound business model, which, in the end, will come crashing down on itself.
Sahm Adrangi earned a Bachelor of Arts in Economics during his time studying at Yale University and is the founder and Chief Investment Officer at Kerrisdale Capital. Before creating the company, he worked with Longacre Fund Management as an investment analyst. There he dutifully did research looking into the equity fund and credit fund. Before this, he worked with Chanin Capital Partners, which is a restructuring group that focuses on bankruptcy. While there, he worked with creditors to offer them advice related to Chapter 11 bankruptcy and also represented bondholder committees as well as bank debt holders. Sahm Adrangi also worked with Deutsche Bank, which is a leveraged finance group. Looking into the future, Sahm Adrangi plans on continuing to shine a light on companies that make great investments for those who are looking for solid short positions.