Two Rivers Analytics (TRA) is an institutional research firm serving hedge funds, mutual fund companies, family offices and RIA’s. We provide actionable, high quality short sale recommendations to our clients. We also publish related warnings for stocks at risk and portfolio strategy work on estimate revisions and factor behavior.
Since inception, Two Rivers’ average short recommendation has profited in absolute terms and relative to broader indices by low teens percentages over 6 month periods (not annualized). Roughly 70% of short recommendations have profited relative to broader indices over the 6 month periods after report publication.
Some notable short recommendations include A123 Systems (AONE), Central European Distribution Co. (CEDC) and Overseas Shipholding (OSG), all of which went bankrupt after our short recommendations. We have also written short reports on Cheniere Energy (LNG), Iconix (ICON), Deckers Outdoor (DECK), Kate Spade (KATE), InvenSense (INVN), Quicksilver Resources (KWK), Clean Energy Fuels (CLNE) and others, generating short profits for our clients.
Our process combines a ranking system designed specifically for short-selling and fundamental analysis. Our models call out companies for:
- Poor earnings quality
- Deteriorating business trends
- Dangerous Financial Condition
- Speculative or unjustified valuations
- And red flags extracted from the footnotes of SEC filings.
Our independence enables us to follow the data where it leads. We provide a perspective frequently at odds with standard sell-side research, in particular, from the larger investment firms. Two Rivers Analytics generates insights that help clients outperform their peers and save time.
- Provides a steady stream of short ideas to hedge funds
- Helps avoid companies with hidden risks on the long side: manipulated earnings, breaking businesses, ‘red flags’, cash flow issues or expensive companies
- Provides a rigorous sell discipline, for which an independent voice is critical
- Saves analysts’ and PMs’ time in getting to good ideas faster
- Deploys a suite of tools to support clients’ efforts