Einhorn's Green Brick Property Venture Plunges as Guidance Cutby
Share slide another hit this year for hedge-fund manager
Green Brick reduced guidance on weather, labor shortages
David Einhorn’s Green Brick Partners Inc. slumped 21 percent in New York trading after cutting its full-year earnings guidance.
The real estate investment company fell to $8.31 at 4 p.m. in New York trading, paring the year’s gain to about 1.3 percent. Green Brick said in a regulatory filing late Friday that 2015 profit will be $22 million to $24 million, lower than a previously announced range of $29 million to $32 million.
Green Brick’s slump adds to Chairman Einhorn’s woes, as his hedge fund, Greenlight Capital, faces its worst year since the financial crisis. The third-quarter loss at his reinsurer, Greenlight Capital Re Ltd., quadrupled from a year earlier as the investment portfolio took a hit from stocks including Consol Energy Inc. and SunEdison Inc.
Greenlight Capital is the largest shareholder of Green Brick, with a 49 percent stake, while Dan Loeb’s Third Point owns about 17 percent, according to data compiled by Bloomberg. Green Brick, which owns stakes in homebuilding companies in Dallas and Atlanta, controls about 4,800 prime home sites and originates about 1,000 secured first-lien loans each year, according to its website.
“Due to a number of factors including weather, new community development, labor shortages and an extended building cycle pushing back closings in its core markets, the company is amending its previously disclosed 2015 guidance,” Green Brick Chief Executive Officer James R. Brickman said in the filing. The company plans to release third-quarter results after the market closes on Nov. 12.