Who is the fraud, Unifi or Citron research?

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Patriot

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Apr 18, 2011
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Patrick

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Dec 21, 2010
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I am going to refrain from commenting on this as I did a strategy project for one of their competitors a little over two years ago.
 

nkw

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Aug 28, 2017
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A lot of news websites seem to be picking up this story...
Citron exposes Ubiquiti Networks - Citron Research?
Sounds like someone took a big short position in UBNT and said someone is ramping their PR machine. For me personally that webpage doesn't present convincing evidence of anything other than that. The only thing I have ever seen that was funky with UBNT was several years ago when they were ensnared in a phishing attack and wired several million $ somewhere. They were the victim, but the fact it happened doesn't give one confidence in their internal controls. But the lemon guy sounds and reads like a goofball.

Disclaimer: I use and like Ubiquiti products, but don't hold any of their stock.
 
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Chris Web

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Sep 12, 2017
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I call BS. They have a large and active consumer base. They also don't have the infrastructure requirements of a worldcom or enron.

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Patriot

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Apr 18, 2011
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The author of that "research" blog seems to have a vested interest in ubnt going down based on the smb training blog.
I wanted to discuss it here not because I believe citrons bold claims but because "news" sites seem to be picking up the story and running with it.
 

CookiesLikeWhoa

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Sep 7, 2016
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It all seems very alarmist, and a lot of it seems very vague.

Disclamer: I use their products and would hate to see the company go under, so here's to hoping nothing bad is going on.
 

nitrobass24

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Dec 26, 2010
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I didn't even read the UBNT article but if you go back and look at their previous articles on other companies you will start to see a pattern of Citron being consistently wrong.
 
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smccloud

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Jun 4, 2013
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I hope Citron is wrong, but this also gives me pause as I was going to recommend UniFi APs for work since our Watchguard APs are dying.
 

Chris Web

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I hope Citron is wrong, but this also gives me pause as I was going to recommend UniFi APs for work since our Watchguard APs are dying.
I have a bunch of clients using unifi, they aren't going anywhere.

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Chris Web

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They made $250 million last year and have $600 million in cash

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dwright1542

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Dec 26, 2015
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Well they certainly aren't perfect. I have a love / hate relationship with UBNT. Are the AP's perfect? No. Do I have 50+ out there? Yup. Because they are way better than anything at that price point. They've been promising Zero Handoff for what, 5 years? When I need a REAL ZH network, I put Ruckus in.

The cameras were a DISASTER for years. Had to eat a 10k system because it was so bad. However, it's matured to the point now that it's WAY more stable.

I think they work on such a barebones approach that I would consider most of their stuff Beta2 quality.
 

nkw

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Aug 28, 2017
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The cameras were a DISASTER for years. Had to eat a 10k system because it was so bad. However, it's matured to the point now that it's WAY more stable.
I forgot about that. I had a bunch of their cameras that were obsoleted before I even got them installed. I guess there was a buyback offer or exchange, but I wasn't reading their forums at the time and just wrote them off. That is the reason I refuse to deploy their VOIP phones, cameras, solar-whatevers, mFi, mPort, or other stuff -- I'm guessing they will kill off the VOIP phones next, which is too bad because they look like they are a nice platform. As bad as their ancillary stuff is, I *really* like their access points, switches, and routers. Pricing is transparent, no having to BS with salesmen or VARs, they regularly update the controller/firmware (and let you be as bleeding edge as you want). They also seem to genuinely listen to community input when it comes to features and priorities.

My biggest concerns with them right now (besides the occasionally fringe product lines) is the need for them to unify (see what I did there?) their unifi and edgerouter lines both for feature parity and so you can manage them cohesively. Also, they have been slow to move to 10 gbe. Now that they have finally moved to 10 gbe (some gripe about the US-16-XG, but for me it was a killer switch at a killer price point), we have started to migrate to 25 and 40 gbe for which they have no offerings.
 
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Dawg10

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Dec 24, 2016
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This isn't about the equipment, it's about the CEO. Robert Pera owns >70% of the shares; he runs the show, all of it. The minimalist Board signs off on whatever he wants, as does the person preparing the financials (the CAO, who, btw, is paid only $100k/year).

Digging into the SEC filings, Ubiquiti has the smell of a Pump & Dump: the Board has authorized multiple share buybacks while the CEO on Aug. 30 sold 1 million shares at $61. This soap opera is orchestrated 100% by the CEO; being incorporated myself, I know how difficult it is to get money out of the company and into your own bank account.

It isn't that much of a leap to consider that Ubiquiti valuation is based upon inflated sales numbers, given the comments of Citron Research. The numbers are too good to be true; something smells.

I also dug into Citron Research; although Andrew Left is a reviled short seller, he is right more often than he's wrong, and he's very smart. He smells crap, and, to him, crap is the smell of money.
 

Chris Web

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Sep 12, 2017
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The whole stock market is over valued. Yes UBNT might be overvalued, but they make money and have very little debt, so the chance of them going under is slim. A lot of people might start shorting the market right now because they think its time for a correction, but I don't see an Enron here.