Swan Street is Short Yalla Group (NYSE: YALA).
Swan Street Research’s Core Opinions
· Yalla Group’s user metrics are inflated by 5x (7x adjusted for bots).
· We are incapable of squaring Yalla’s financials with observed in-app usage, 3rd party data, and former employee interviews. We harbor deep skepticism of Yalla’s reported revenues and cash balance. We believe ~50% of revenues and ~50% of Yalla’s cash balance are likely fictitious.
· Yalla’s financial statements do not reconcile with economic reality and Yalla is a credible de-listing candidate. We value Yalla at $1-2 per share, or Yalla’s IPO cash.