Greenlight Capital founder shifts to European industrial stocks, warns of tech bubble in US stocks
David Einhorn, founder of Greenlight Capital, is optimistic about European industrial stocks, believing that government stimulus, falling energy prices, and a peace agreement in Ukraine will bring benefits. He holds a neutral stance on U.S. stocks, considering their valuations too high, especially for unprofitable tech companies. He pointed out that peace in Ukraine will create reconstruction opportunities for European industries and mentioned that the stock price of Solvay in Belgium has reached an all-time high. Einhorn no longer publicly discusses short targets, believing that the market is unwilling to accept the information
According to the Zhitong Finance APP, David Einhorn, the founder of Greenlight Capital Inc., is currently optimistic about the European market, particularly favoring the industrial sector in the region. He believes that government stimulus measures, the decline in global energy prices, and the potential for a peace agreement in Ukraine will create favorable conditions.
In an interview at the Sohn Conference held in Montreal on Wednesday, Einhorn also expressed caution regarding the United States' ability to withstand the trade war with China, as "it seems no one can accept empty shelves."
However, the precision of Chinese technology, cheaper labor, and the fact that China has long been preparing for conflict with the U.S. mean that the U.S. should "be ready to take a heavy punch."
He holds a neutral view on U.S. stocks, believing they are "not undervalued" but "very, very expensive." He added that unprofitable tech companies are unlikely to meet their valuation expectations.
Einhorn pointed out that European companies are in a cyclical downturn due to the war in Ukraine and soaring energy costs. However, he believes that a potential peace agreement in Ukraine "will bring a lot of reconstruction work, creating opportunities for European industry."
The stock price of Belgian soda ash producer Solvay SA reached an all-time high last month after Einhorn disclosed his investment in the company.
This influential hedge fund manager no longer publicly discusses short positions. He prefers to see stock prices "decline for their own reasons" rather than because he claims they are overvalued.
"I used to think providing information to the market could create a lot of value," but "I think the market simply doesn't want to hear any information," he said, "so sharing short positions is meaningless."
