Below please find Greenlight Capital's (David Einhorn) Q3 2011 letter to investors - hat tip to marketfolly for posting. In the letter he discusses some new positions - CBS, GM, and MRVL. GM is particularly interesting as I have heard Bill Ackman of Pershing Square discussing his small position in the automaker and its interesting to see Greenlight follow suit. Basically David Einhorn's contention is that GM is being priced by the market as a cyclical company trading at less than 6x this year's earnings. While some may see it as normal to value cyclicals at low multiples of peak earnings, we believe that 2011 is not a peak and, in fact, is below mid-cycle. They purchased GM at $25.78 and it closed yesterday at $24.01.
The letter also spends some time walking through the Green Mountain (GMCR) position and their thoughts on Sprint (S) and Delta Lloyd (Netherlands: DL).
Enjoy.
Greenlight-Q3-2011
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