Fuzzy Panda Research issued a cautious report on Napco Security. The firm, which says it is short Napco, says it spoke with former employees, competitors, and industry experts, and walked away with “more questions than answers” about Napco’s opaque financials. Industry experts thought margins were “unfeasible” and that Napco was likely trying to hide more COGS on their balance sheet, the firm says. Fuzzy Panda also says it discovered multiple balance sheet anomalies that could unravel Napco’s “too good to be true numbers.” The firm stated: “We believe Napco is a rare opportunity to short a high multiple boring business where the growth is gone, former employees allege fraud, and investors don’t seem to know yet.”
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