Callouts & quotes from 529+ activist slides

"Spruce Point believes BR has also experienced operating expense bloat in the past few years that will amplify the downside risks. We observe that its SG&A margin has creeped back to levels not seen since the 2014-2016 period. This is even despite efforts to rationalize its real estate footprint."

"Spruce Point believes that Forescout will have trouble reaccelerating its top-line growth rate as it attempts to win smaller, more price-sensitive mid-level customers with less comprehensive cybersecurity needs – particularly as the ongoing pandemic pressures budgets across the global economy."

"Starboard believes Mr. Riedel's direct involvement in the restructuring of Nortel, including the sale of the Nortel's patent portfolio for $4.5 billion, as well as his knowledge of the technology industry and leadership experience, will enable him to provide invaluable oversight to the Board."

"Spruce Point believes that changes in Executive and Board leadership at Enfusion are highly troubling. Notably, at least two members have served at companies targeted recently by other short sellers while the CEO was Chief Risk Officer at a firm that settled with the SEC for illegal trading."

"Spruce Point believes that Bemis had much worse working capital than Amcor, and not simply 2x Amcor's as suggested by an analyst. Over the preceding, six quarters prior to deal closing, we calculate Bemis' working capital to sales ratio averaged 13%. Amcor's working capital was around zero."

"Pershing Square believes, based on our investigation, that in the past Herbalife's compliance department made essentially no effort to enforce or audit compliance with the 70% Rule or the Ten Customer Rule and has taken steps to make Herbalife's return policy unattractive to distributors."

"CLEAR is also eliminating the Net Member Retention metric going forward and instead will rely on Gross Dollar Based Retention which embeds both member retention and ARPU growth. Spruce Point believes this is a ploy to hide the underlying problem which is cancellations or member retention."

"We spoke with a former Avery employee who has over 20 years of experience in the label industry. He told us that he believes the risk of increased consolidation among converters is being underappreciated and continued consolidation will result in tangible pressure being exerted on Avery."

"Engine believes that following strong Q4 results, HMHC stock would have traded at or above $19.50 per share, implying the Veritas offer represents an insufficient premium of 7.7% instead of the 36% premium the Company is advertising based on an artificial low point tied to a media leak."

"Spruce Point believes that PLUG cannot issue equity or raise debt fast enough to support its current restricted cash build - and, therefore, cannot continue to support customer leases through operating-type leasebacks, the source of the Company's recent "inflection" to profitability."

"Spruce Point believes it is extremely bearish that Generac’s Chief Marketing Officer (who was also named President of the new Energy Technology organization) resigned in Feb 2022, shortly after the CEO claimed he and his team were “incredibly bullish” on Generac’s long-term outlook."

"Spruce Point believes current sell-side analyst price targets are wildly optimistic. The consensus estimate projects 74% upside to Generac’s share price. Almost 90% of its stock promoters have a “Buy” recommendation or equivalent. 11% are “Hold” and not a single analyst says “Sell”."

"Spruce Point believes there is significant downside to Nuvei’s share price as the Company is overvalued on all financial metrics, and should trade at best in-line with peer valuations, and at worse a material discount to reflect the numerous concerns we’ve documented in our report."

"With the aligner printing software space finally attracting innovators which are addressing historical shortcomings among in-house 3D printing software, Spruce Point believes that one of the major bottlenecks prohibiting more widespread in-house aligner printing is set to collapse."

"Spruce Point believes that investors should be concerned by AMR's recent auditor dismissal of KPMG in favor of RSM in 2020. The change doesn't appear to be arbitrary. Rather we find a sequence of events leading up to the change that suggest there were problems at the Company being."

"Spruce Point believes that Bloomberg is emerging as a powerful new player in the ESG and Climate space and that MSCI is aware of this by now disclosing it as a competitor. Bloomberg offers a comprehensive suite of analytics under the ESG function for public equities that it tracks."

"Spruce Point believes that acquisitions have brought between $10-25M in incremental inorganic sales per quarter to Verint through the last three years. Acquisitions could generate another $125M in inorganic sales through FY20 even if management conducts no further M&A during FY20."

"Spruce Point generally likes the BPO space tied to the digital company, but believes there are better horses to bet on with more attractive relative value and lower risk. Specifically, Spruce Point favors Concentrix and Majorel and is long both securities, while being short TASK."

"Trian believes the attributes, skills and qualifications that Mr. Peltz possesses through his experience as a hands-on executive and active board member on numerous public company boards will provide DuPont and its Board with valuable industry knowledge and management experience."

"Trian believes the attributes, skills and qualifications that Mr. Peltz possesses through his experience as a hands-on executive and active board member on numerous public company boards will provide DuPont and its Board with valuable industry knowledge and management experience."

"Spruce Point believes there is significant downside risk to Xylem’s share price as its premium multiple is reconsidered by institutional investors in the face of abandoning its 2025 targets and the Evoqua acquisition at both an extreme valuation and under troubled circumstances."

"Elliott has engaged Mr. Lawson as a consultant on its investment in Arconic and believes that Mr. Lawson should be a leading candidate to become the Company’s CEO, as he has the ideal set of skills needed to turn around Arconic’s woefully and continually underperforming business"

"Trian believes the attributes, skills and qualifications that Mr. Peltz possesses through his experience as a hands-on executive and active board member on numerous public company boards will provide DuPont and its Board with valuable industry knowledge and management experience"

"Spruce Point believes that Evoqua made potentially misleading statements by dismissing sales concerns about Mar Cor, while continuing to increase the earnout asset value, an implicit reflection that it expected to receive the earnout back from its failure to meet sales targets."

"Spruce Point believes there are better points in the home purchasing timeline to build stronger relationships with potential home buyers, and through professionals that have developed deeper relationships with customers (eg. Real estate brokers, mortgage brokers and lawyers)."

"Spruce believes Kalshi and other prediction market entrants (e.g., Polymarket) represent a much larger threat to DKNG than to Flutter (FLUT). DKNG is almost entirely U.S.-dependent, with ~61% of its total revenue coming from its U.S. sportsbook, compared to just 29% for FLUT."

"Starboard believes that Mr. Feld's experience as an active stockholder, board member, and expert in capital markets and corporate governance practices, as well as his knowledge of intellectual property licensing, will enable him to provide invaluable oversight to the Board."

"Spruce Point believes that the economics of hydrogen refueling stations are so poor, 12.5 years to repay investment amount without overhead (based on Foshan refueling station economics), that they will never be built barring significant sustained subsidies from government"

"Spruce Point believes there is significant downside to Lightspeed’s share price as the Company appears overvalued on both revenue and gross profit metrics, and should trade at a material discount to peers given the strong evidence we’ve presented of its inferior business."

"As we articulated earlier with numerous supporting points, Spruce Point believes Stryker's valuation multiple is rich and needs to compress. Given the stock is heavily levered, there's a wide range of downside price targets sensitive to which metric Stryker is valued on."

"Spruce Point Conducted Proprietary Analysis To Investigate Vets First Choice’s (“VFC”) Recent Performance And Believes There Is A Window Of Opportunity To Purchase Shares Of HSIC Today At A Steep Discount To Where Wall Street Analysts Will Eventually Value The Company"

"With Penumbra more penetrated than the sell side believes in the peripheral thrombectomy market – a market which is already more crowded and competitive than the neuro market – we believe the Company's runway for growth is far more limited than is generally perceived."

"Spruce Point believes that - while, to date, most offices have announced closures only through April or May - Align is put at particular risk by the ongoing pandemic, and that investors have not yet properly taken the associated near-to-medium term risks into account."

"Spruce Point believes Sunrun's inclusion of financing companies in its peer set is appropriate to represent the financing and leasing aspect of Sunrun's diversified solar business. We believe these peers are more relevant for Sunnova's pure financing/leasing business."

"Spruce Point believes it's a classic red flag and sign of financial strain when GAAP figures become increasingly divergent from the "Non-GAAP Adjusted" figures highlighted by management. We observe that Stryker's EBIT adjustments are now almost 70% of its GAAP figure."

"Believes Company Announcement to De-Stagger Board Two Days Before Annual Meeting and 10 Years after More than 85 percent of Common Shareholders Voted for this Measure is Too Little Too Late and Fails to Address Deeply Imbedded Issues with Taubman Governance Structure."

"Spruce Point believes BR's real serviceable addressable market may actually be lower than the $5 billion that Broadridge promotes because it includes financial institutions' in-house solutions which are likely to be sticky, entrenched and difficult for BR to replace."

"While BOOT is struggling, it splurged on a brand new 116,000 square feet corporate headquarters which is 37% bigger that its existing space. Spruce Point believes that BOOT should be doing more with less and not expanding SG&A while it posts poor financial results."

"In summary, the author believes IULs are complex instruments that contain features that are hard for the average consumer to understand; many of these features ultimately come with very high fees, which can threaten a policy's cash value during market downturns."

"Spruce Point believes investors should be outraged that management is receiving “off cycle” RSU grants to “retain” management. Is something going wrong at Stryker that the Board is helping to conceal from investors such that management needs inducements to stay?"

"Believes physicians will simply substitute generic suspension – “Yep, I agree 100%...that’s what I would do probably” – and listed similar precedents where an expensive branded drug was immediately substituted by an inexpensive generic in a different formulation"

"Spruce Point believes that the recent terrible financial results reported by Carvana continue to validate our concern about its uneconomic business model that isn’t scaling, is capital destructive, and favors insider enrichment over shareholder wealth creation."

"Trian believes the mindset and culture at State Street has prioritized growth (in AUCA, AUM and revenue) over profitability. The “land grab” mentality must transition to a focus on EPS growth, return on invested capital and maximizing total shareholder returns"

"Trian believes the successful execution of management's new strategic plan could result in Lazard earning slightly more than $3.50 per share in 2014, which could translate into an implied value per share of more than double the current trading price of $23.09"

"PBH reports “non-GAAP adjusted free cash flow.” Spruce Point believes this is particularly egregious and aggressive, as the Company adds back integration and transition costs, therefore ignoring the costs of M&A but wanting to show investors all the benefits."

"Greenlight believes both anecdotal evidence and methodological valuation flaws suggest that Allied’s portfolio investments have not been marked to current “fair value” according to Allied’s own standards or as required by the Investment Company Act of 1940."

"Spruce Point believes it is a major red flag when a company stops being able to provide Free Cash Flow (FCF) guidance. We observe this happened after the departure of CFO Young in mid 2020. In the year he left, BR missed FCF guidance by an astounding 15.3%."

"Spruce Point believes there is significant downside risk to MSCI’s share price as its premium multiple is reconsidered by institutional investors in the face of intensifying competition, moderating cash flow and dividend growth, and lower earnings quality."

"Spruce Point believes there is significant downside risk to PERI’s share price as the Company is signaling financial strain and will have difficulty in hitting lofty growth targets while cash flow is starting to contract and it accrues for severance costs."

"Spruce Point believes DY's margins are not likely sustainable and may have benefited from various actions that may be difficult to continue. As further evidence of our concern, management has walked back talk of what its long-term EBITDA margin should be."

"The sell side believes that Dexcom's target U.S. market is 25% penetrated, leaving significant room for continued CGM adoption. However, under Spruce Point's view of Dexcom's optimal market opportunity, Dexcom's current market is already ~50% penetrated."

"Spruce Point believes sell-side analysts and investors are not factoring in multiple issues that will likely cause Generac to severely miss its lofty financial expectations and/or should factor into Generac receiving a lower valuation relative to peers."

"Spruce Point believes omitting a clearly identifiable 10.71% minority interest in a principal subsidiary undermines the reliability of the Company’s financial reporting and risks overstating EBITDA, profits, and cash flow available to SGHC shareholders."

"WD-40 talks about its market dominance and great market position. Spruce Point believes it is a market that others chose to largely underinvest in because there either isn’t enough growth, or its not financially attractive enough to deepen the channel."

"Despite little discussion of competition in China from Ballard, Spruce Point believes that the “Sinohytec chain” is best positioned to capture the China fuel cell opportunity given relationships with influential research universities and manufacturers."

"Spruce Point believes LSPD is opaque and does not give investors enough information to evaluate its business model. For example, management admits it tracks CAC, LTV, monthly retention and churn. Yet, why doesn't it disclose these metrics to investors?"

"Spruce Point believes our assumptions are conservative given there is a good chance the state litigation ends up at SCOTUS, allowing Kalshi to operate at least through 2026. In our base case, we estimate DraftKings risks missing 2026 revenue by ~15.0%."

"Elliott believes such measures would create in excess of EUR 7 billion of value, representing more than 35% upside for Sampo shareholders, and would restore market confidence and reinforce management’s reputation for delivering value-creating outcomes"

"Spruce Point believes Healthcare Trust of America, Inc. (HTA or the Company) and its Audit Committee should open an investigation into its reporting of Same-Property Cash NOI, which exhibits virtually no volatility - a statistically unlikely outcome."

"Spruce Point believes Avery's business has been an abject failure over the past 20 years. It has spent $1.8bn on R&D, $2.8bn for acquisitions, and incurred $1.0bn of restructuring costs. All the while, annual Free Cash Flow hasn't consistently grown."