Callouts & quotes from 572+ activist slides

"Since the most recent acquisition of Fleet closed in 2017 PBH’s share price has underperformed. We believe PBH will continue to underperform as headwinds result in negative organic growth and declining margins."

"Spruce Point finds that companies claiming superior margins that poorly plan and execute against capex projections have underlying problems or poor visibility, which ultimately lead to earnings disappointment."

"We believe PGNY needs the clinics more than they need PGNY and that short, 1-year clinic contracts only increase clinic network negotiating leverage, which we believe may pressure PGNY margins going forward."

"New long-term incentive plan rewards measurable results: organic sales growth, gross margins, and credible ROIC targets while retaining certain sustainabililty elements, but focused on verifiable benchmarks."

"GFL restated its Adjusted EBITDA a second time in Q2 2020 to make the USA Waste segment's margins look much better by +2.1% (210bps). The boost came from allocating more costs to the “Corporate” or account."

"What Spruce Point finds amazing is that Saputo has been able to improve margins after the 2018 step down, without sacrificing any labor or rationalizing excess capacity (which it has now ceased disclosing)."

"Monster recently started referencing "production inefficiencies" as impacting gross margins. Could the inefficiencies be so bad that Monster has to ship products over 5,000 miles from Ireland to California?"

"~400 bps of improvement in MDLZ margins, bringing them in-line with diversified food peers (but well below snacks peers), would yield ~$1.4bn in incremental EBITDA (potentially worth ~$16bn to shareholders)"

"MTD does not disclose sales by industry end market, instead broadly reporting sales in three product categories (lab, industrial, and retail) without providing details of margins in these three categories."

"By adjusting CLEAR's gross margins for labor and transaction fees, we see that its gross margin is 2,430 basis points lower than the promoted margin and 800 basis points lower than the peer group average."

"At a minimum, industry leading FMCG companies should achieve normalized gross margins of over 45%. Currently, we estimate Consumer Products Gross Margins remain below pre-Covid levels and far below peers."

"Based on our research we believe there is an opportunity for Tessera to deliver double-digit revenue growth, achieve best-in-class EBITDA margins of 60-70%, and create significant value for shareholders."

"Compared to the investor day guidance from less than 2 years ago, investors are now expecting UNP to grow volumes at only one-third of guided levels and grow revenue at half of guided incremental margins"

"Dollarama consistently produces operating margins materially higher than industry peers, and higher than historical industry norms. This gap has only grown more substantial through the last five years."

"In our Mid and High cases, we believe EBIT margins could be ~8.3% to 9.3%. In our Low case, if same-store sales remain flat, we believe Lowe’s can maintain current EBIT margins through cost reductions"

"We believe it will be challenging for PowerSchool to expand in these markets in a meaningful way without diluting margins because of the structural differences in education funding in foreign markets."

"Tessera has repeatedly licensed outsourced semiconductor assembly and test companies (OSATs) instead of higher value OEM and manufacturer licensees despite OSATs having far lower revenue and margins."

"We would understand if margins declined due to investments in growth, but organic growth is worse than when Solventum was inside of 3M, and the Company has not created an expectation for improvement."

"Kornit's valuation is rich for a commodity-type digital printing company, and analysts are overly optimistic that it can sustain 20%+ revenue growth while expanding EBITDA margins from 7.6% to 17.8%."

"the peak plasma levels of Pitolisant after 6 consecutive daily doses will be 2.3x higher than they were on Day 1 but the Day 1 plasma concentrations were used to estimate the safety margins for QTcF."

"We find that its prices are on average 15%-20% higher. Weis' prices decreased 8% relative to peers between mid-year 2017 and 2018. As a result, we expect Weis' gross margins to be pressured in 2018."

"When we asked him about trends in hardware margins, he responded by saying that ARPU as a whole had "dropped significantly". This is a completely different picture than management tells investors."

"Since its IPO, it's evident that LSPD's business has become more competitive by analyzing hardware margins. Whereas before, it could make money on the POS systems, now they are sustaining losses."

"Our price target is based on the nature of a business unlikely to meet the market's overly optimistic expectations of captured market share, GGR revenue share and inflated target EBITDA margins."

"Lone Star's Adj. EBITDA margins are set to decline in FY25 by 150bps and the fine print disclaimer around the projected margin gives us considerable hesitation in believing they can be achieved."

"According to a former high level Xylem executive we interviewed, digital sales are dilutive to margins. Yet, Xylem’s CFO suggested recently that a higher digital mix would bring higher margins."

"Within asset management, JP Morgan is delivering strong actual margins for shareholders, as opposed to adjusted, "pro-forma" illustrative margins that do not ultimately create shareholder value"

"We see a large disconnect between the high costs and high margins and how they can co-exist with each other. This was our first clue that something might be amiss with the company’s financials."

"Assuming 2% comps and the Company’s unit growth plan, if EBITDA margins were to improve 100bps by 2008 (returning to 5-year average levels), EBITDA could increase by 41% from “reported” levels"

"Applying peer target compensation levels of 55% in advisory(1) and more than the peer average of 40% in asset management, we believe Lazard has the potential to achieve +30% margins over time"

"Despite a stellar 2019, we believe Chipotle still has significant unrealized growth potential, with average restaurant sales still 12% below peak levels and margins ~700bps below peak levels"

"In total, we believe our plan for Office Depot will improve operating margins from 0.9% to 7.3%, while providing Office Depot with a plan to successfully transform the future of the Company."

"[W]e believe BWLD company-owned stores could improve margins substantially, by up to 500 [basis points] based on our analysis, by adopting labor practices currently deployed by [franchisees]"

"For example, with clear evidence that EBITDA has been shrinking, margins contracting, and excess manufacturing capacity increasing, why has Saputo continued to add headcount year-after-year?"

"Based on peers, we conclude that there are potentially material opportunities to improve ADT's cost structure as a standalone public company, enhancing both EBITDA margins and free cash flow"

"If AMR is over-reporting production, there is a strong possibility its revenues and coal inventories are overstated. Overstated inventories can also to overstated margins and profitability."

"Spruce Point believes that analysts overvalue AOS because they believe its margins are superior, sustainable, and that the recent growth setback is "temporary" and not of long-term concern."

"As the currency hedge benefit has reversed through the last two years, underlying gross margins have purportedly risen by *EXACTLY ENOUGH* to keep total gross margins steady between 39-40%."

"A sharp increase in operating expenses as a percentage of sales have resulted in AOL's EBITDA margins declining from 34% in 2009 to 16% in 2011 and falling substantially below peer levels."

"As growth slows, companies should moderate expense growth such that margins improve and the combination of growth + profitability improves over time – Autodesk has been doing the opposite"

"Spruce Point observes many signs of financial stress in Generac’s financial statements. Gross margins are declining, inventory turns are decreasing and earnings quality is deteriorating."

"BK's earnings are cyclically pressured by decade-low net interest margins due to a prolonged period of low global interest rates and a growing mix of excess deposits on the balance sheet"

"Quantumscape projects a hockey stick revenue ramp in 4 years, reaching $3.2B and $6.4B by 2027/2028 with $808MM and $1.6B in EBITDA, respectively – approaching Google and Apple margins."

"When we adjust Samsara's COGS to assume a three-year amortization period for device costs, we find that gross margins have been overstated by well over 600bps the past two fiscal years."

"Based on extensive research and discussions with culinary experts and suppliers, we believe we can accomplish these goals at Olive Garden’s current price points without hurting margins"

"Based on extensive research and discussions with culinary experts and suppliers, we believe we can accomplish these goals at Olive Garden’s current price points without hurting margins"

"I think Dlocal has a stronger, sales team, but they, they don't really look into profitability. You're only looking into TPV growth. And, um, and that's why their margins are thinner."

"According to two former executives, DLO's relationship with Google started out operating at a loss, and later was running on wafer thin net margins of just a few basis points at best."

"Despite Mr. Simmons’ claims that growth and value creation are just around the corner, margins have not improved and the synergies from the Bayer transaction have yet to be realized."

"If P&G could achieve 3.5% annual COGS productivity over the course of its restructuring program from FY 2011 to 2016, we believe the Company would easily generate 51.5% gross margins"

"We believe measuring integrated margins skews the Company's view of product profitability, and may be masking poorly performing businesses or impeding the Company's pricing strategy."

"All the BPOs servicing Facebook, and I'm not sure but probably at least a dozen, are doing low margins just to have the name, to learn, and leverage that name in their sales efforts."

"Moving to a distribution model similar to O'Reilly's will allow AAP to significantly increase SSS growth, while leveraging existing boxes & infrastructure to further improve margins"

"In Q2'22 even the CFO said there was no target for margin expansion and yet margins are +880bps since. Management should provide enhanced disclosure to explain how this is possible."

"Intuit has among the lowest CFO margins and highest SBC per employee. Importantly, Intuit has the worst revenue visibility (by far), a reason SaaS companies trade at rich multiples."

"Assuming TheFork gets sold at 5x CY26E revenue, Viator improves margins, and Brand Tripadvisor stabilizes growth and/or improves margins, the PF Company trades at just 2.5x EBITDA!"

"Assuming TheFork gets sold at 5x CY26E revenue, Viator improves margins, and Brand Tripadvisor stabilizes growth and/or improves margins, the PF Company trades at just 2.5x EBITDA!"

"Assuming TheFork gets sold at 5x CY26E revenue, Viator improves margins, and Brand Tripadvisor stabilizes growth and/or improves margins, the PF Company trades at just 2.5x EBITDA!"

"Assuming TheFork gets sold at 5x CY26E revenue, Viator improves margins, and Brand Tripadvisor stabilizes growth and/or improves margins, the PF Company trades at just 2.5x EBITDA!"

"Recognizing IFRS reporting conventions can make comparisons difficult depending on the company reporting convention, we believe Heska provided inflated guidance on BiEssiA margins."