Oatly short seller says stock worth less than $10 after accusing company of overstating revenue

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A carton of Oatly brand oat milk is arranged for a photograph in the Brooklyn borough of New York, U.S., on Wednesday, Sept. 16, 2020.
Gabby Jones | Bloomberg | Getty Images

Short seller Ben Axler said Thursday that Oatly's stock is worth less than $10 a share after his firm released a report alleging the company engaged in shady accounting practices and misled investors about its sustainability claims.

The stock fell 3% in morning trading on Thursday, a day after Axler's firm Spruce Point Capital Management released the report. Still, shares are still trading around $20, giving the company a market value of $11.9 billion.

“Oatly is one of those inflated bubble stocks,” Axler said on CNBC's “Squawk Box” on Thursday.

In late May, Oatly priced its U.S. initial public offering at $17 per share. Since making its public market debut, the stock has not fallen below its IPO price.

The company has denied the allegations, calling the claims “false and misleading.”

“This short seller stands to financially benefit from a decline in Oatly's stock price caused by these false reports,” the company said in a statement to CNBC on Wednesday. “Oatly rejects all these false claims by the short seller and stands behind all activities and financial reporting.”

Spruce Point's report includes claims that Oatly overstated its 2018 U.S. revenue by $6 million, failed to disclose that its gross margin calculation is not comparable to that of other food companies and has inflated its capital expenditures.

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