Another Hedge Fund Hotel Explodes: Endo Craters

Another Hedge Fund Hotel Explodes: Endo Craters

Tyler Durden’s pictureSubmitted by Tyler Durden on 05/06/2016 10:39 -0400

The pain for specialty pharma companies continues.

Yesterday afternoon, Endo International PLC – an “Irish” company that was one of the last tax inversions completed before the Treasury cracked down on the practice – reported not only that its losses deepened in its latest quarter, pressured by an asset impairment charge, but also slashed guidance citing higher competition and lower generics pricing.

The company said it now expects total revenue for the year to be between $3.87 billion and $4.03 billion, down from a previous range of $4.32 billion to $4.52 billion. The company also warned that its EPS would plunged from a range of $5.85 to $6.20 to between $4.50 and $4.80, a cut in guidance of more than 20%.

The stock has since imploded, down nearly 40% overnight.

The pain, however, is especially acute for a lot of hedge funds, because as Goldman reminds us after the spectacular blow ups of Valeant and Allergan, and recently, the plunge in uber hedge fund hotel AAPL, Endo itself is one of the stocks that has the highest hedge fund concentration in the S&P.

Who are these hedge funds? Most of the usual suspects including Visium, Viking, Paulson, Brahman, MSD and of course countless bank prop desks as listed below.

So if we report next week that the “smart money outflows” have continued for a record 15th week, we will know who the weekly scapegoat is for the latest redemption deluge as panicking hedge funds are forced to liquidate other assets to cover for their massive P&L blow ups in ENDP this morning.

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