Business

Shares of Carl Icahn’s hedge fund drop 25% after attack from rival Bill Ackman

Shares of billionaire Carl Icahn’s investment firm plunged to their lowest level in nearly two decades on Thursday, a day after old rival Bill Ackman called out the company’s high valuation.

Icahn Enterprises LP’s stock tumbled as much as 25% to $18.03, deepening losses of more than 60% that were recorded following short-seller Hindenburg Research’s scathing attack on the company three weeks ago.

“(IEP’s dividend) yield is generated by returning capital to outside shareholders, which is in turn funded by the company selling stock to investors,” on Wednesday, echoing Hindenburg’s allegation that IEP was relying on a “Ponzi-like structure” to pay dividends.

Ackman said he held no long or short p🥀ositions in the stock.

In a memorable clash a decade ago, the billionaire had shorted supplement company Herbalife, in which activist i𓆏nvestor Icahn𒉰 was a shareholder.

IEP did not respond to requests for comment on Ackman’s tweet.

Carl Icahn
Hindenburg Research launched a scathing attack on Carl Icahn’s company three weeks ago. NBCU Photo Bank/NBCUniversal via Getty Images
Bill Ackman
Bill Ackman said he held no long or short positions in the stock. REUTERS

At least one technical indicator suggests that the selloff in IEP shares is overdone, wꦡith the stock having traded below 30 on the relative strength index (RSI) since May 22.

An RSI score of 70 and above points to an overbought stock, while a r𝔍eading of 30 or below i🍃ndicates that it is oversold.