Callouts & quotes from 26,677+ activist slides

"The article stated that “the Chinese authorities suspended the registration and approval of direct selling amid a nationwide crackdown on wrongdoing in the health products market”, and this means Morinda and other direct-selling companies in China are not expected to increase their presence in cities/provinces any time soon."

"Amy Satov, Nuvei’s Senior Legal Counsel, mysteriously disappeared from Nuvei’s website after March 2021 and no regulatory filing was made. She was replaced by Lindsay Matthews in May 2021 as General Counsel and Corporate Secretary. The timing of her departure in relation to the departure of Allan Lacoste appears suspicious."

"The Loan Platform Business is not a capital-lite “tollbooth” generating fee income from connecting borrowers with third-party buyers. It appears to be a sophisticated financing arrangement called a “wet-funded forward flow agreement” that, in our opinion, SOFI is using to disguise borrowings against loans as sales of loans."

"We attribute ~2.3% of annual AFFO per share growth from 2008 to 2017 is from interest rate savings. If you strip out the growth from interest rate savings, the AFFO / Share grew at annualized rate of 3.5%. We warn investors not to extrapolate O Realty's AFFO historical growth as interests turn from a tailwind to a headwind."

"Spruce Point fact-checked C3's claim from a May 23, 2018 press release announcing a partnership with Intel. We observe that on the same day C3 announced the alliance, Intel also issued a press release about enterprise AI, without referencing C3.(1) A review of Intel's website suggests limited evidence of a deep partnership."

"they might push you and say, well, I think this liver is fine, you should use it... they are pushy...they’re a pushy company...they will say ‘I think this liver is going to work...I think it’s usable...you should use it...it’s their medical director, Attia...they lose the money...so they try really hard not to lose organs.”"

"Sometimes lost in the talk of Amazon's regional growth are the AWS offices near Dulles International Airport. AWS named Fairfax County the home of its East Coast hub roughly four years and said it would add some 1,500 new jobs. Amazon leased some 400,000 square feet at the time but added another 275,000 square feet in 2019."

"The cost is absolutely outrageous...my concern is certainly, is this cost-effective? And if they are charging half a million to $1 million per person, that is very expensive for a drug that isn’t that novel ...it’s hard to justify the cost of the diazoxide, the normal formulation, which the Proglycem is about $800 a bottle."

"Harmony’s sales are dependent on a handful of physicians, paid via a speakers program that ex-employees described as a blatant kickback scheme; one of Harmony’s top speakers estimated that he and four others he knows are responsible for 5-700 of all Wakix patients - 20-30% of total revenue depending on how one does the math"

"ENFN claims that managed service revenue increased by $1.6 million from new clients and $2.7 million from existing clients, offset by churn (which is not quantified) for a total of $4.3 million. However, total segment revenue only increased by $2.7 million. Therefore, we estimate revenue lost from churn to be ~$1.6 million."

"Avery’s former Audit Committee Chair (and current member) Peter K. Barker has had an illustrious career. His biography in Avery’s financial filings fails to highlight his role at Stone Energy Corp (“Stone”), a Company that was investigated by the SEC and did a complete financial restatement through the time of his arrival."

"We believe Skechers' stock price has been largely driven by outsized China growth. Absent the China story, we believe Skechers is “just” a moderate growth, “fast follower” shoe company that will likely never be able to compete with the performance athletic shoe companies that have vastly larger markets and stronger brands."

"We find it remarkable that Samsara has continued to trade at a premium valuation despite embodying all the attributes that have traditionally resulted in valuation multiple discounts: SMB focus, hardware business, and communications focus. Thus, we expect Samsara’s eventual multiple compression will be particularly severe."

"Spruce Point believes there is little margin for error in food manufacturing, since the slightest mistake can cause contamination, illness, and even death. The repercussions could be long-lasting and tarnish the manufacturer's brand. We've noticed a recent uptick in product recall notices by Saputo, particularly in Canada."

"BR recently struck an annually recurring statement that it processed approximately 80% of the outstanding shares in the U.S. in the performance of its proxy services. It has replaced this statement with a hard figure of 700 million equity proxy positions. BR’s change of language could suggest it has lost core market share."

"In the Company’s August 2021 investor presentation, PGNY uses the fictional treatment scenarios of “Sarah” to highlight the scary downsides of conventional treatment paths and the superior outcomes achieved through its more intensive treatment protocol. However, we believe PGNY’s pitch contains numerous misrepresentations."

"It's a bit of a quagmire because they announced a PDN study with the potential for a new indication. Well, the physician community is using it for that anyhow. Okay, maybe if the physician community is reimbursed for it, but they're coding funky anyhow. I don't know how much of an uptick it's going to give them in revenue."

"Spruce Point has serious concerns with Mr. Starrett who has served on the Board since 2010. Mr. Starrett's biography fails to disclose that he served on both the Boards of AFC Enterprises (Nasdaq: AFCE) from 1998 – 2005 and The Pantry (Nasdaq: PTRY) from 1999 – 2006 during the period when a financial restatements occurred."

"We believe PGNY's intimation that “Sarah” suffered a miscarriage due to the lack of PGT is marketing fluff. We believe PGNY is capitalizing on patients' (often reasonable) assumption that the increasing use of new technologies must improve health outcomes. Once again, the actual science does not fully support their claim."

"Chinook, in our opinion, improperly recorded collaboration and licensing revenues from SanReno in 2021 and 2022. This seems to have been an intentional mischaracterization to create the false impression that Chinook’s pipeline, especially atrasentan, can be easily monetized and generate repeatable and sustainable revenue."

"The reporter (appears to be a physician) “assessed acute arterial hypertension as serious and the causality with pitolisant as possibly related”; “although the event is confounded by methylphenidate, for which increased blood pressure is labeled, an association with (b)(6) cannot be ruled out and is assessed as possible.”"

"The ~20 field visits our investigators made to Lasertec’s Innovation Park indicate that management’s claims are false with no evidence of R&D, production, assembly, testing; no evidence that Fab 4A is operational or even a completed clean room; no evidence of other clean rooms or a second phase of construction for Fab 4B."

"The Capital and Business “Alliance” announced by Keisei and Aeon in October 2024 appears to be both economically unattractive and commercially pointless for Keisei – the hallmarks of an arrangement to place more Keisei shares in the hands of cross-shareholders to support this cycle of self-serving management entrenchment"

"The extraordinary deficiencies in Muddy Waters' "proof" and "analysis" – including presenting information for the wrong customer, failing to investigate and report publicly available information, and failing to make follow-up inquiries with CCME – naturally casts doubt both on their capabilities and/or their objectivity."

"…We find many of your responses to the shareholders’ concerns to be misleading, self serving, and defensive…Given the inconsistencies in many of your recent communications, we expect that the shareholders would welcome Elliott’s nominees to the Board to ensure proper and timely execution and to avoid risk of backsliding."

"AMR uses a discount rate for certain pension obligations near 2.6%, its weighted average financing lease expense is 9.6%, and its Term-Loan interest cost is 10%. Using these range of assumptions for its incremental borrowing cost, we estimate that AMR’s “Hidden” Interest-Bearing debt obligations are $138 to $690 million."

"iRhythm claimed that the three consultant reports were privileged because they were prepared in anticipation of a potential whistleblower lawsuit by a regulatory compliance employee. The court recently ruled in favor of the government on the discovery fight related to the third-party reports, though iRhythm has appealed."

"Coca-Cola is an iconic world-wide American brand that also depends on its “trade secret” formula and brand equity. To put WD-40’s extreme valuation in perspective, we compare the two. Not only does Coca-Cola have broader diversification, but also significantly higher margins and growth potential despite being 88x larger."

"We appreciate that Disney's studio operations are critical to sustaining a durable competitive advantage, and we do not want to do anything to jeopardize Disney's creative output, but it is imperative that Disney's content strategy strikes the right balance between creative risk-taking and maximizing return on investment"

"When we examine the assumed useful lives of customer lists/relationships for SMB SaaS acquisitions or acquirers' general policies (i.e., not specific to a single transaction), we find that the average of the values/mid-points yields 5.8 years, which represents greater than 50% discounts to the assumptions used by Intuit."

"We believe the market wildly overvalues the entirety of BR by not considering that 40% of its business is tied to low/no margin distribution revenue and services such as credit statement printing. Its gross margins and capex spending (due to aggressive capitalization of costs) are vastly below financial technology peers."

"REZI has been talking up its growing relationship with home builders for the First Alert smoke detector business. However, based on our research interview of a former executive familiar with the business, it is a narrower product opportunity which depends on larger volumes and carries less margin than the retail channel."

"Spruce Point has developed concerns over the Company’s aggressive accounting practices, several connections to high-profile actual and alleged fraud cases (e.g. an Enron spin-off, Qwest Communications, and Granite Construction) among its board, and its CFO who was previously sued over an alleged breach of fiduciary duty."

"We identify at least four factors that are temporarily inflating OCF by an estimated 67%-78%. We also point out numerous errors and inconsistencies with management's figures. We believe at best, these are just sloppy errors, and at worst case these are intentional acts by management to obscure its strains from investors."

"it's pretty quiet overall... what I'm not hearing people say, when can I get my hands on Vykat? Because we all know diazoxide, and we all know the problems with it. It's not like we're clueless. I'll put it this way...this somewhat surprising and out of the blue approval that I don't think any of us were quite expecting."

"We are short CTO Realty Growth (CTO) because we believe this management team, like our old friends at B. Riley (RILY), are lying to investors about the sustainability of their dividend while enriching themselves and are willing to engage in accounting shenanigans like using a sham loan to cover up a top tenant’s failure."

"As of the publication date of this report, Muddy Waters, LLC (possibly along with or through our members, employees, and / or consultants) has a short position in the stock (and / or options of the stock) covered herein, and therefore stands to realize significant gains in the event that the price of the stock declines."

"At the end of the day, we believe LODE has failed to deliver on its corporate promises, has a subpar CEO, and illiquid assets of little productive value. We believe the LiNiCo transaction won't succeed and that investors should value LODE at a multiple of its cash. Our price target is approximately $0.35 - $0.70 /share."

"When we put the pieces together, including all-time high DSOs, all-time high finished goods inventory (equating to as much as 2.6 quarters of handpieces), generally flat utilization, and a smaller than estimated procedure market size, we can only surmise that Procept and its customers are stuffed with excess handpieces."

"The pattern is again similar to Sakti3 and Quantumscape: dangling groundbreaking data ("testing to over 2,000 cycles", "commercially viable formats", "high yield"); promoting its "first pilot line" just as QS has begun to do in recent weeks; and pointing to a major strategic investor, Samsung, as "a vote of confidence.""

"Southwest is led by a team that has proven unable to adapt to the modern airline industry; the Company’s release today seems to admit as much by stating that the revenue guidance reduction was the result of “complexities in adapting” to the current environment — complexities that Southwest’s peers seem able to adapt to."

"With its own broadband service priced at a premium of as much as $10-$20 above broadband services provided by the MSOs and RBOCs, it became increasingly clear that any strategy predicated on reselling access services over another company's infrastructure in competition with the infrastructure owner would be challenging."

"It’s not just the deep-pocketed private equity firms, or the top 5 largest and publicly owned pest control companies, that are looking for acquisition targets. They also compete with mid-tier players that position themselves as a better fit for sellers as smaller, family-owned businesses where culture and people matter."

"The issue with the circular revenue with Synlogic, basically, they provided Synlogic $30 million, Synlogic turned around and paid it to them, so they were registering their own money as revenue, and then they tried to make a strain for Synlogic, and it didn't work, and then they had to go to Zymergen and get the strain."

"While we attempted to engage in good faith with the Board about Norfolk Southern's future, the Company repeatedly sent its private jet to Washington, D.C. to pursue the support of regulators, requested public support from customers to bolster its planned fight against us and refused to meet our proposed management team."

"The fact that IONQ is using funds raised from investors hoping to get a first bite of the apple on a highly innovative, high-margin, secular growth story in quantum computing and using it to buy a highly cyclical low-margin business in a mature industry like semiconductor fabrication is an inconvenient fact to overlook."

"Two of the incumbent nominees oversaw the substantial value destruction that we believe occurred at BOTH Red Lobster and Smokey Bones, and three were on the Compensation Committee that, as described later, put into place an incentive structure we believe that encouraged excessive spending as the answer to every problem"

"Shareholders asked the Company to pause and reconsider what we believe to be a value destructive plan to separate Red Lobster with a substantial majority of shareholders formally requesting that Darden hold a special meeting to discuss this very topic, and the Board blatantly ignored shareholders’ clearly stated wishes"

"Two of the incumbent nominees oversaw the substantial value destruction that we believe occurred at BOTH Red Lobster and Smokey Bones, and three were on the Compensation Committee that, as described later, put into place an incentive structure we believe that encouraged excessive spending as the answer to every problem"

"Shareholders asked the Company to pause and reconsider what we believe to be a value destructive plan to separate Red Lobster with a substantial majority of shareholders formally requesting that Darden hold a special meeting to discuss this very topic, and the Board blatantly ignored shareholders’ clearly stated wishes"

"Valuing FSCT shares at a more conservative multiple – below that of its purported peer group – and taking into account (A) management’s unreleased guidance and (B) the potential impact of the pandemic on sales, Spruce Point believes that FSCT shares are worth 50%-60% less than the $33 price set by the merger agreement."

"I have been a surgical nurse for 40 years and have seen many patients receive SCS...and many, many fail, or return to surgery for fractured electrode wires, misplaced wires, or infected battery pockets...spinal fluid leaks...severe headaches...[they] find out in 2-8 months that they wish they never had agreed to it ..."

"In 2016, Deckers combined its e-commerce and retail segments into a single segment called Direct-to-Consumer (DTC). This combination in reporting makes it very difficult to isolate retail results. Allowing for a modest decline in e-commerce margins would still imply a single digit margin for retail in FY2016 and FY2017"

"By changing accounting policies for acquisitions, LSPD's transaction-based ARPU would be artificially inflated. LSPD provided a chart showing how the transaction-based ARPU grew from 23% to 37%. However, it doesn't disclose how much of this increase came from changing from "Net" to "Gross" accounting from acquisitions."

"While the difference between separating all or parts of beverages is ~$8 per share in value, we believe the intangible benefits of separating the entire business are considerable: 1) creates two pure-plays; 2) preserves global brands; 3) maximizes probability of value-add strategic moves for each business in the future"

"He stated that during his role in the KLA’s EUV mask inspection group, key Lasertec customers were coming “crying” to KLA and “begging us to expedite”: “I’m talking about customers coming to KLA… saying, guys, we need you to develop this tool…P2 can only be done by a clean tool…they were really begging us to expedite.”"

"Remitly's valuation premium is better illustrated graphically. We understand the case of Remitly's valuation being above the legacy players that have larger physical footprints and more hardware exposure (e.g. Euronet (ATMs) & Western Union (stores)), we do not believe its large premium to Wise or PayPal is justified."

"A close partnership (or merger) between VIP and PetIQ was the best of both worlds for Merial. Merial's support of such an arrangement would not surprise us: anecdotally, veterinarians report that Merial turned a blind eye to grey market diversion through the early to mid 2010s in a similar effort to push retail sales."

"We find it extremely suspicious that management conveniently chose to stop disclosing this number this year, just as their TAM runway is beginning to run out by our estimates, and just as product-level sales growth patterns appear to reveal sales growth has been driven by factors other than growth in the patient base."

"Warning: Oatly's prospectus claims there is no pronounced seasonality in its business. However, Spruce Point uncovered an academic study in Sweden, at the same university its founder conducted its research, that contradicts this. In fact, the report claims that since launch, Oatly has experienced a seasonable pattern."