Callouts & quotes from 553+ activist slides

"Spruce Point has evaluated thousands of financial statements over the years, but we have never seen an income statement charge called “unused office space” which Kratos repeatedly discloses. We are not buying what Kratos is selling"

"Spruce Point has conducted a thorough forensic review of the Amcor / Bemis transaction, including management’s bold claims for the transaction. Our analysis either disproves, or calls into question, each of the main selling points."

"Spruce Point has conducted a thorough forensic review of the Amcor / Bemis transaction, including management's bold claims for the transaction. Our analysis either disproves, or calls into question, each of the main selling points"

"The things that made Mortara what it was disappeared after the acquisition. The entrepreneurial culture was lost.... Sales people who were familiar with the flagship product were dropped, and it didn't sell as well under Hill-Rom."

"The point of a strategic process is not to sell the Company below its intrinsic value, but to explore whether shareholders could monetize their shares at or above intrinsic value today without having to take any execution risks."

"Distributors purchase products from Herbalife at what HLF deems to be “wholesale” prices and consume the products themselves (“Internal Consumption”) or resell them at retail prices thereby capturing the markup (“Retail Profit”)"

"The loss of the PPB will undoubtedly hit margins. While the sell-side optimistically projects a gross margin rebound and a reversal in R&D and SG&A as a percentage of revenue, the changes to tax policy make this scenario absurd."

"Since Q1 FY16, Carvana has generated a weighted-average gain on loan sale as a percentage of principal balances sold of 4.0%. In other words, it sells its finance receivables – largely subprime loans – for 104 par in aggregate."

"Our channel checks demonstrated that a good percentage of these agents do not sell, or in some instances, have never sold Caesarstone, which raises the question why they were ever recorded as reseller agents in the first place."

"Because of the timing of Sambara Stiftung’s complete disposal of its Ströer shares—the same day the Müller/Rumplehardt sale and large stock sales by Dirk Ströer’s Ströer (now Delphi) Beteiligungsgesellschaft, and Udo Müller and"

"We believe the controls may be insufficient by design, as Inteliquent appears to profit significantly from illicit scam and robocall activity by selling blocks of phone numbers to bad actors and routing the calls they generate."

"PowerSchool claims that Amy McIntosh is an "independent" director. However, we question her fitness to the Board given her director role at EAB Global, a reseller owned by Vista Equity, the largest voting control shareholder."

"If a plan purports to sell a product or service, check to see whether its price is inflated, whether new members must buy costly inventory, or whether members make most “sales” to other members rather than the general public."

"Insiders have been aggressive sellers of DXCM shares throughout the history of the Company, and sold in particular size as the stock ran up in 2015. Insiders and directors now own just 1.8% of shares, down from 8.2% in 2012."

"The sole manufacturing facility of a rapidly growing company selling one billion RMB of product annually should be a hive of activity with production workers scurrying about, and a bustling shipping and receiving department."

"Instrument is not usable by most scientists; “technically very challenging to use”; using it actually slows down projects versus speeding them up – the key selling point; takes years to learn the ins and outs of the machine."

"Margins are already “industry leading” and yet Rollins is now talking about SG&A initiatives. With such strong cash flow, why is Rollins only now making these investments with the Rollins family and management selling stock?"

"Margins are already "industry leading" and yet Rollins is now talking about SG&A initiatives. With such strong cash flow, why is Rollins only now making these investments with the Rollins family and management selling stock?"

"As PARC continued to churn out technological breakthroughs, Xerox failed to combine this innovation with sustainable and profitable business models – often selling their creations for little to no long-term value for Xerox:"

"We believe that dispositions can be managed to cosmetically enhance aggregate occupancy rates across the portfolio as well as selling properties that may result in re-leased recapture rates that would dilute O Realty’s SSRs"

"Since GreenPower has never sold a Buy America Compliant vehicle, then it won’t be able to sell any in New York. It won’t get subsidies from there unless it manufactures the much more expensive Buy America Compliant version."

"Spruce Point finds little independent evaluation of management's claims from the sell-side analysts, whom are compensated with lucrative fees for assisting GFL with financing and M&A advisory fees to implement its roll-up."

"Spruce Point believes projections from “all other customers” ex: Baker Hughes embedded in sell-side estimates are simply too high given significant employee turnover across verticals and regions, and our backlog analysis."

"In addition to Abcellera, Isoplexis and Sphere Fluidics sell instruments at a quarter of the cost; simpler to operate while retaining “just enough of the functionality of Beacon to make it useful in similar applications.”"

"We estimate that Twist sells to Ginkgo at 1.5 cents per base pair, and experts indicate that the cost to manufacture is “probably 9-10 cents at this point,” which by our math comes out to a gross margin of negative 533%."

"Chairman & CEO Jason Jiang, board member & venture capital star Neil Shen, and close business associate of Mr. Jiang & venture capital star Xiong Xiangdong were among the selling shareholders of Allyes at the rich price."

"We have every reason to believe that each of these "researchers" is actually a short seller, and each stands to make money – at the expense of our stockholders – when they succeed in driving down the price of our stock."

"Economic theory posits that as a firm's weighted average cost of capital rises, the firm's valuation should decline. In a perplexing case, we observe that Stryker's bond holders are selling, driving up its cost of debt."

"In order to sell a deal to the Capital Committee and get Board approval or whatever amount you want, Mobius was like over $200 million, you have to be pretty optimistic with what you think your revenues are going to be."

"One of BOOT's strongest selling brands has historically been Ariat and they were frequently disclosed as the #1 brand in the Company's investor presentation. However, BOOT now only discloses its top "exclusive" brands."

"The plain meaning is that it is selling the asset, maintains a subordinated security interest, and as "Debtor", its property remains subject to a lien, suggesting its interest in the asset was never fully extinguished."

"We look at all different options. We've looked at contributing into the pension plan. We've looked at joint ventures. We've looked at just selling it out right to developers. We've looked at can you sell it to a REIT."

"At best, we believe it was unethical for Mr. Ehrlichman not to disclose his work at HelpScore.com while ACTV was in the process of selling shares, and at worst this could be construed as securities misrepresentation."

"Notice that there is a theme among the negative (and even some positive) reviews: clinic managers pay outsized attention to profits over pets, and employees are encouraged to upsell patients to expensive medications."

"We spoke to a WFG recruiter who explained to us that we could earn ~$50K/year in part-time income by helping one family per week (four per month). In reality, the average WFG agent sells just 0.4 policies per month."

"Just reorganizing the core business through cost cuts could create an extra $30/share in value above a Starboard sell it now outcome; with a recovery in BABA shares and tax efficiencies, Yahoo could break $100/share"

"People might argue that Morinda, as opposed to NHTC, obtained a direct selling license in China. However, having a direct-selling license does not prevent scrutiny and even a crack down from the regulators in China."

"Niccolo De Masi, Genius director and CEO of DMYD, has been vocal about Genius on his Twitter account. We find it very uncommon for a Company executive to be publicly promoting a sell-side analyst’s research report."

"When we inquired about C3.ai with a Microsoft sales agent, he knew almost nothing about the product, and directed us twice back to C3's website for more information. The agent made no effort to sell us C3 directly."

"In addition to the Rollins family selling stock, we observe that the CEO adopted a 10b5-1 trading plan to liquidate stock as early as October 2022, coincident with the completion of the Terminix / Rentokil merger."

"So, we can tabulate the press releases to estimate enterprise bookings. You might not think this qualifies as deep research but none of the sell side analysts have written about this and the results are revealing."

"We believe that the Company is best positioned if it moves quickly to simplify its portfolio, but not at the expense of rushing to sell businesses at subpar valuations or based on depressed profitability levels."

"Even before the recession, Target’s retail margins have been deteriorating while Wal-Mart’s margins have remained higher and constant, despite Wal-Mart selling a greater mix of food and other lower margin goods"

"Even before the recession, Target’s retail margins have been deteriorating while Wal-Mart’s margins have remained higher and constant, despite Wal-Mart selling a greater mix of food and other lower margin goods"

"Founder Scott Cook plans to sell another ~850k shares (or about $500 million) of Intuit shares through October 2025, but what we find more striking is the declining insider ownership of other Intuit executives."

"Our conversations with a selling shareholder and a former AMT employee involved in the transaction confirm that AMT paid the selling shareholders approximately $300 million, and not the $585 million AMT claims."

"The takeaway from stock action and, in our opinion, sentiment since 12/20/13 is the stock rallies when there is movement toward replacing management and sells off when management publicly digs their heels in."

"The takeaway from stock action and, in our opinion, sentiment since 12/20/13 is the stock rallies when there is movement toward replacing management and sells off when management publicly digs their heels in."

"It’s time for some fresh outside eyes and thinking at the Company from someone who isn’t looking to squander corporate assets on share buybacks at rich multiples, so that he can sell stock at inflated values."

"It appears that someone has been buying large amounts of OTM call options on MOXC to create a gamma squeeze, in which the dealer selling the call options must buy the reference equity to hedge their position."

"This report is dedicated in the memory of Matt Farrell (1969-2022). Matt was Spruce Point's most dedicated and loyal Twitter follower. Matt was a true polymath and ardent supporter of short selling activism."

"Sell-side analysts justify their price targets through contortions of logic, such as assuming development success rates six times the industry norm – even for a company with PeptiDream's dismal track record."

"Darden's recent Bylaw amendments and the Board's decision to ignore shareholders and sell Red Lobster underscore the Company's disregard for shareholder interests and call into question the Board's motives."

"Spruce Point has a strong track record of exposing highly promoted “technology darlings” as technology dogs before the sell-side and investors could figure out that the businesses had inflected negatively."

"We believe FND trades at an irrational premium to peers and that sell-side expectations are too high. Where we differ the most is new store operating expenses which we estimate are set to rapidly increase."

"We Believe There Is A High Probability Of A Credit Ratings Downgrade Which Is Forcing The Company To Sell Assets And Reevaluate Capital Allocation - Required Debt Reduction Of ~C$1,600m vs. FCF Of ~C$200m"

"Spruce Point believes Sunnova’s sell-side coverage is unsatisfactory and a result of the misalignment between Sunnova’s leasing business and analysts’ coverage of the solar and alternative energy sectors."

"Selling WELL and buying VTR and AHR is not a bet against senior housing. It is a bet against paying a 144% premium for the privilege of funding a compensation plan that may ultimately dilute your returns."

"We wish sell-side analysts – who haven't the tools, inclination, or interest to do the work – would respect the segregation of our jobs and not offer hollow reassurances to investors in these situations."

"Spruce Point has been following the DKNG story closely, and despite the recent share price movement and other prescient short-seller critiques, we believe there is still significantly more downside risk."