SAN DIEGO (TheStreet) -- Disclosure: I've done zero work, and have no intentions to do any work, on Chicago Bridge & Iron (CBI), which was the focus of an accounting takedown by Prescience Point Research Group.
But I do have a take on CBI's response -- and I wouldn't be saying anything if it wasn't for the nature of its response.
Not this part:
CB&I has reviewed the report and strongly disagrees with its assumptions and conclusions.
But this part:
Notably, the report warns readers to assume that the short-selling firm and/or its affiliates hold short positions in CB&I common stock and that they stand to realize significant gains in the event that CB&I's stock price declines. CB&I believes that this conflict of interest should cause the report and its conclusions to be viewed skeptically.
To which I say: Of course they're conflicted -- but no more or less conflicted than somebody own owns the stock. Prescience Point, which says it spoke with the company twice during its research, discloses that it's short at the top of its report.
This ridiculous concept of trying to deflect critical commentary because the author is short is feeble, amateurish and, well, absurd, unless the company also criticizes bullish reports by analysts who it believes are conflicted because they own the stock.
Reality: Everybody, if they own or short a stock, is conflicted. Everybody talks their book. That's Wall Street.
The trick is trying to figure out who really knows what they're talking about. And even then, even if they do, it doesn't mean they'll be right -- and certainly not always right and certainly not always right in the typical momentum-driven trading cycle in which we now live.