David Einhorn poked fun at the $100 million deli he brought to light after 3 men involved were charged with fraud
The Greenlight Capital boss, who quipped the deli's pastrami must be amazing to justify its massive valuation, jokingly reassessed that view.
Mike Segar/Reuters
- David Einhorn joked about the $100 million deli after charges were brought against those involved.
- The Greenlight Capital boss shed light on Hometown International in a letter to clients last year.
- Einhorn warned it was the kind of company that amateur investors could lose money in.
David Einhorn has poked fun at the $100 million deli he brought to light last year, after three men involved with the company were charged on Monday with alleged crimes including securities fraud and market manipulation.
The billionaire investor and Greenlight Capital boss first highlighted Hometown International, the owner of a single New Jersey deli, in a letter to clients last April. He noted the company had generated less than $40,000 in sales over the past two years, yet it commanded a $114 million market capitalization.
"The pastrami must be amazing," Einhorn quipped at the time.
The hedge fund manager nodded to that comment in a Monday tweet about the charges brought against three of Hometown's alleged masterminds: Peter Coker Sr., Peter Coker Jr., and James Patten.
"I guess the pastrami wasn't so great. I never really got a chance to try it," Einhorn joked, attaching a crying-with-laughter emoji.
The Greenlight boss originally shed light on Hometown as he worried it was the kind of stock that amateur stockpickers could lose their money in, and he wanted regulators to do more to protect unwitting investors.
Einhorn declined a request for comment from Insider.
Hometown garnered national attention not only because of its outsized valuation, but because of how unconventional it seemed. For example, the company's largest shareholder, Paul Morina, was also its CEO, CFO, treasurer, a director, and the local high school's wrestling coach.
Prosecutors accused Coker Sr., Coker Jr., and Patten of artificially inflating the value of Hometown stock by trading it among themselves. They also alleged the trio used the same approach to boost shares of another tiny public company, E-Waste, from 5 cents to $10 between 2019 and 2020.