When the organizers of the Investor Summit conferences asked me to come up with a panel for their Q3 event, I thought it would be fun to do a bull versus bear discussion on a specific stock. I racked my brain for a little while and came to the conclusion that it would be interesting to have a back and forth with another investor who was long the same stock. As such, I reached out to my good friend, Rob Longnecker of Ides Capital Management, and suggested that we duke it out on KAR Auction Services (ticker: KAR).

We had to flip a coin about who was going to be the bear. He called heads, I called tails, and I got to be the bear. What is truly interesting about KAR is that it represents the definition of a battleground stock. It is really easy to come up with compelling long and short cases for the company. The conversation that Rob and I had was very much like the conversations we have internally at Cove Street during our team-tackles of ideas. So, I thought I would have the upper hand. But Rob came very well prepared and, while there was no official winner declared, I would give Rob the nod. Even though I think Rob had the stronger case, it was a great exercise for me to dig even deeper into the company in order to clearly articulate the downside case.

If you are interested in understanding the bull and bear cases for KAR, please see the YouTube replay below or click here to view on YouTube:

-Ben Claremon