market folly

At yesterday's Value Investing Congress (our extensive notes from the event here), David Einhorn of hedge fund Greenlight Capital presented the short case for the St. Joe Company (JOE). Einhorn lays out why he is short JOE with the main reason being that the company has a vastly overvalued portfolio of land and needs to take impairments.

He argued that should St. Joe convert into a rural land company, it would be worth around $7-10 per share. JOE currently trades in the low $20's, and that is after taking a 10% haircut solely due to Einhorn's speech yesterday. Alternatively, the Greenlight Capital manager argues that if the company keeps with its current practices, the stock could be worth $0 in 10 to 15 years.

Below we have embedded an audio file of Einhorn's speech, as well as the actual slideshow of his presentation further down the page. This way, you can follow his walk-through as if you were there (email readers will need to come to the site to hear the audio).

Simply press play to hear Einhorn and don't turn your volume too high because the background applause/laughter is loud on occasion. Please use either the Firefox or Internet Explorer web browser for the best compatibility with the audio file.