Despite the recent downward pressure that Square’s co-founder, Jack Dorsey, is facing from a short-seller, Hindenburg Research, it is still too early to determine if his career as CEO of two prominent companies, Twitter and Square, will eventually be brought to a dramatic ending.
The recent development started with the release of a report by Hindenburg Research accusing Dorsey of having misled investors by manipulating Square’s stock prices. However, Square have since launched an investigation into the matter, vehemently defending Dorsey and denying all claims of fraudulent activity.
In recent years, short-sellers have become increasingly vocal and aggressive in taking action against their targets, and it appears that Hindenburg Research is at the forefront of this new trend. The recent news of the firm’s attack on Dorsey is just the latest example of their aggressive tactics.
Despite the risks associated with such an attack, however, it is worth noting that this type of scrutiny is not completely uncommon when a company’s performance is under review. In the case of Dorsey and Square, it appears that this will be a period of harsh assessments, but short of something drastic happening due to the scrutiny of financial records, it is too early to determine if men such as Dorsey will ultimately be brought to ruin.
That said, it appears that the pressure is steadily increasing on both the CEO and his company. This is evidenced in the call from some investors to replace Dorsey and make a clean break from the past, as well as the ongoing issues facing the company, such as a reported dispute with the US Internal Revenue Service over taxes.
At this point, it is too early to tell if the Hindenburg Research’s recent attacks will ultimately be successful or if Dorsey will manage to ride out the storm. In the end, it will come down to the facts and the strength of the company’s performance going forward. As such, it is too soon to tell if Jack Dorsey will get “blown up” by Hindenburg Research.
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