Nuvei Corp (TSE: NVEI) is trading down on Tuesday after Spruce Point revealed a short position in the financial technology company.
Nuvei was involved with FTX
The short seller is primarily taking aim at the payments firm for its involvement with FTX.
In its bankruptcy filings, the recently collapsed crypto company (find out more) had named Nuvei as its creditor that doesn’t sit well with Ben Axler – the Founder and Chief Investment Officer of Spruce Point Capital Management.
Axler is convinced that the Canadian firm is under significant business and financial stress. Speaking with BNN Bloomberg, he said:
We have issues not just with management, but the underlying business, which appears to be getting worse. They need more transparency, disclosure, and everything we see out of them gets more opaque.
For the year, Nuvei stock is up nearly 60% at writing.
Nuvei stock could be cut in half
The “strong sell” investment opinion also targeted the $1.3 billion acquisition of Paya Holdings Inc that Nuvei announced in January – raising questions on its disclosed number of customers and growth projections at large.
The stock market news arrives only a day after famed actor Ryan Reynolds revealed a stake in Nuvei Corp. According to Ben Axler:
Reynolds is there to tell the story, and he’s telling the story. But our real question is: did he put his own money into the company? Or was he gifted that through an equity issuance of restricted stock?
He questioned if the partnership with Reynolds was just a well-timed gimmick for promotion. All in all, Spruce Point warns the Nuvei stock could be cut in half moving forward.
The post Spruce Point targets Nuvei stock in its ‘strong sell’ report appeared first on Invezz.
