By Svea Herbst-Bayliss

BOSTON (Reuters) – Andrew Left, who has long targeted companies that he thinks are over-valued through his work at Citron Research, told investors on Monday that his new hedge fund returned 43% after fees in 2019, its first year in business.

Left also made a prediction that home furnishing company RH, one of his winners last year, may make a tempting takeover target for someone.

“In 2019, our first full year of operation, Citron Capital, LP (“Fund”) generated a gross return of 56.4% and net return of 43.3%,” Left wrote in the letter seen by Reuters.

While the fund bet that certain stocks would climb, Left also bet that certain ones would drop, writing “the Fund’s average exposure during 2019 was 75.8% long and 80.3% short.”

Left said that winners on the long side included Bausch Health (TO:), RH (N:), and Snap (N:) and on the short side included Ligand Pharmaceuticals (O:), Jumia Technologies , and Grand Canyon Education (O:).

After investing only his own wealth for roughly two decades,Left in 2018 began laying the groundwork for Citron Capital, his hedge fund. By raising outside capital, Left has more firepower to go after some of the biggest U.S. companies.

Citron has not disclosed the size of its hedge fund.

For this year, Left said RH, whose stock price closed at $212.77 on Monday, may be bought. “We believe the company has matured to a point that we might see it acquired in 2020.”

He also said he is sticking by his bet that shares in Peloton (NASDAQ:) Interactive, whose stock closed at $29.75 on Monday, will fall. “Citron put a one-year price target of $5 and we stand by it as $5 makes this still a $1.5 billion company.”

Neither RH nor Peloton responded immediately to emails seeking comment.

Left also gave investors lessons that he learned last year; reminding himself and others to stay away from what he calls “big story ‘cult stock'” companies and sticking with what he does best: exposing fraud.

He also said that this year will be a year of growth and that he is looking to expand beyond his home base in Los Angeles.

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