GlobalStar (GSAT) is Short Idea at Kerrisdale

GlobalStar (Nasdaq: GSAT) is lower as Kerrisdale Capital says it is short the stock and the equity is worth "$0."

The firm called GlobalStar "The Most Egregious $4 Billion Stock Promotion Since Sino-Forest." (Link to Report)

"Globalstar is the most egregious stock promotion we have come across since Sino-Forest," says Sahm Adrangi, Chief Investment Officer of Kerrisdale Capital. "Globalstar's proposed paid Wi-Fi offering is nothing more than the company's latest gimmick to stave off bankruptcy, a stunt that rivals Allen Chan's fake forests as the most successful stock-market fantasy we've ever come across."

Kerrisdale believes the company is currently valued at $4 billion due to misleading and ill-informed publicity over the company's spectrum holdings and a proposed licensable Wi-Fi channel currently under review by the Federal Communications Commission. This licensable Wi-Fi channel will never be commercially viable, and its spectrum is unusable terrestrially in all other use cases. The combined value of the company's unprofitable core satellite business and potential terrestrial applications of its spectrum assets is lower than its debt burden, making the stock a zero.

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