The Bear Cave #342
Welcome to The Bear Cave! The last premium articles for paid readers were: “ Problems at Guggenheim Strategic Opportunities Fund (GOF) ” and “ 5 Education Stocks in AI’s Blast Radius .” Our next special investigation is scheduled for Thursday, September 17. Subscribe now New Activist Reports J Capital Research published on Karman Holdings (NYSE: KRMN — $5.3 billion), a defense and space parts roll-up. J Capital notes that Karman books strong revenue growth and steady profits while generating no positive operating cash flow. The report expresses doubt that Karman’s backlog converts to cash anywhere near the rate implied by its 70 times forward earnings valuation. J Capital Research writes: “That concern is compounded by Karman’s habitual debt-fueled acquisitions of companies frequently disclosed as ‘not material’ to the results of its operations despite big-ticket payments, in some cases even after a period of time. Ongoing weak internal controls at Karman, given difficult accounting challenges for defense products, increase our concern.” Fugazi Research published on ZeroStack (NASDAQ: ZSTK — $75 million), which is — naturally — a former-cannabis-grower-turned-decentralized-AI-treasury-built-on-the-0G-token. Fugazi points out that the token behind the pivot is marked at less than a tenth of its $163 million cost, and the company has reported its second going-concern warning in three years. Fugazi Research writes: “The company settled its only material debt obligation, the Zero Gravity Convertible Note, by transferring 50 million 0G tokens directly to the noteholder on March 31, 2026, paying down debt with treasury assets rather than operating cash flow or refinancing. The balance sheet looks cleaner because the company handed over the thing that was supposed to be the whole investment thesis.” Notable Recent Resignations and Departures Notable executive departures in the past week include: Chief Operating Officer of Ralph Lauren (NYSE: RL — $21 billion) notified the company on August 31 that he will retire, seventeen months after the role took effect in March 2025. His successor, currently the chief product and merchandising officer, takes over on November 29. In August, Ralph Lauren’s Head of Design and Brand Operations announced their departure on LinkedIn, as did the company’s Head of Global Data Science & AI who took a job at Barclays. Executive Vice President and Chief Operating Officer of Silgan Holdings (NASDAQ: SLGN — $4.4 billion) will leave the packaging company on September 30 under what it said were “mutually agreed” upon terms. This comes about twenty months after the COO took on the role in February 2025. Vice President, Controller and Chief Accounting Officer of Frontdoor (NASDAQ: FTDR — $5.7 billion) told the company she will resign effective September 18 to pursue other opportunities. The company also saw a cluster of insider sales in August, with three executives selling shares. Chief Accounting Officer of Amrize (NYSE: AMRZ — $24 billion) was replaced effective September 1, just over a week after the company named a new CFO because the sitting one stepped down for personal reasons. Chief Medical Officer of Quest Diagnostics (NYSE: DGX — $26.4 billion) apparently left the company, an exit that surfaced through his LinkedIn. The company’s CEO also sold shares this week, with Quest’s General Counsel selling over $5,000,000 worth at the end of August. Unannounced departures courtesy of Canary Data . News of the Week “KPMG warned Guggenheim unit over deficiencies in internal controls” ( Financial Times ) “The Big Four auditor identified shortcomings linked to how a subsidiary of Guggenheim’s $367bn asset manager recognized hundreds of millions of dollars in revenue, according to people familiar with the matter. The assessment, which came after a whistleblower flagged up concerns about the unit’s accounting practices, highlights how the troubles at Walter’s businesses extend beyond his insurance holdings.” Tweets of the Week Until next week, The Bear Cave New? Sign Up Here Got Feedback? Just Hit Reply The Bear Cave is Not Investment Advice. See Full Disclosures Here . Based on Hunterbrook Media’s reporting, Hunterbrook Capital is short $GOF at the time of this publication. Positions may change at any time. Twitter: @BearCaveEmail