Cettire shares slump after investment manager divests
Make us a preferred source
Make us a preferred source on Google
The news: Cettire shares slumped in early trading following reports that one of its biggest investors had divested from the company.
The numbers: The luxury retail platform's shares were down 7.93% to $2.84 at 12:01pm AEST. Over the last 12 months the company’s share price has increased 55.46%.
The Australian Financial Review reported on Sunday that LHC Capital had sold out of the company and said in a note to investors that share sales by Cettire's founder and chief executive were a “red flag”.
LHC sold half its stake earlier this year after the company's share price rocketed but only fully exited after Cettire’s chief executive Dean Mintz sold $127 million in shares last month. In “quick time”, Mintz had sold shares totalling $362 million, LHC said.
The context: Cettire has been at the centre of one of the fiercest debates on the ASX as supporters have watched the company grow from a $133 million minor in July 2022 to an almost $2 billion company. A healthy number of sceptics believe, though, that it is an opaque business that is overvalued.
The company was recently thrust into the spotlight after reports that duties charged by the company on goods were not paid to the federal government, claims which Cettire has rejected. Following this, the company reviewed its policies and updated its checkout flow.
Some Australian fund managers are not concerned about Mintz selling shares as the disagreement in the market ultimately comes from whether the company's growth story is truly good or too good to be true.
The source: Australian Financial Review
