Callouts & quotes from 26,677+ activist slides

"Trian believes Mr. Winkleblack’s substantial executive experience, including almost 12 years of service as Executive Vice President and Chief Financial Officer of H.J. Heinz Company, provides him with knowledgeable perspectives on strategic planning, international operations, acquisitions and divestitures and cost and financial controls."

"With the largest component of Hill-Rom’s PP&E facing a maximum ten-year useful life - the same period over which management appears to have delayed capital spending - we believe that the Company may be forced to ramp up capital spending substantially in the coming years simply to support maintenance capex, to say nothing of growth capex."

"With the largest component of Hill-Rom’s PP&E facing a maximum ten-year useful life – the same period over which management appears to have delayed capital spending – we believe that the Company may be forced to ramp up capital spending substantially in the coming years simply to support maintenance capex, to say nothing of growth capex."

"It is telling that the Investment Agreement also generally prohibits the KKR Investors from transferring their shares to any “Activist Shareholder” (as defined in the Investment Agreement and which includes, by that definition, Starboard), further demonstrating that the Investment Agreement is nothing more than an entrenchment mechanism."

"Carvana management likes to say that it currently has access to $1.5bn in total committed liquidity (excluding unpledged real estate assets). In reality, of this amount, only $488m as of 1Q23 is cash on hand with the balance primarily short-term revolving capacity available only for financing vehicle inventory and funding customer loans."

"BEA should have strong strategic value to a potential acquiror given its meaningful market share in Hong Kong and extensive nationwide branch network in China (and related licences), all of which exceed those of other family-run (or formerly family-run) banks and which should justify a commensurate premium in a change of control scenario"

"We believe Nuvei's talk about having to “accelerated investments” that are being pulled forward from 2022 into 2021 is a negative development that dovetails with our research findings that many of its technology processes are dated, and that its easiest high risk, higher margin business that benefited results recently won't be repeated."

"Given the size of legal spend, it appears that Tessera pays full cash legal fees at extremely high hourly rates for all of its litigation instead of opting for performance driven structures, such as the use of partial contingency fees that reduce cash outlays, share risk and incentivize law firm performance as opposed to billable hours."

"HASI’s claims should be subordinated to the tax equity partners and project debt holders. With significant debt on a project that has generated substantial losses since inception, color us skeptical that HASI will be able to hit its hurdle rate (let alone avoid a loss) over the remaining ~12 years of the project’s 13-year contract life."

"Management's decision to ignore shareholder concerns and go forth with an undervalued sale of Red Lobster as opposed to waiting for operations to improve or entertain monetization without fully disposing the brand during a depressed earning's period will likely result in meaningful changes at the board level and among senior management."

"Twist has no value proposition beyond price and is a bottom-tier vendor with a poor reputation, viewed as inferior to even Chinese vendors, due to escalating manufacturing delays, product limitations, a lack of sample purity and quality control, and other problems that have shut it out of pharma, clinical work, and anything FDA-related."

"The contrast with Welltower is stark in our view. Moghadam built Prologis from scratch over 40+ years, voluntarily caps his pay at $25 million, and accepts that his outperformance plan sometimes pays zero. Mitra has been CEO for 5.5 years, inherited his portfolio, and structured a plan that could pay him 100 times Moghadam's annual cap."

"The reliability is so low that Lasertec’s tool is simply not “production-worthy”: “their tool doesn’t work reliably”; “doesn’t work well enough for production”; doesn’t work well enough overall,” which leads customers to beg KLA to hurry its competing actinic inspection tool – “and that’s why customers want KLA to make a reliable tool.”"

"The reliability is so low that Lasertec’s tool is simply not “production-worthy”: “their tool doesn’t work reliably”; “doesn’t work well enough for production”; doesn’t work well enough overall,” which leads customers to beg KLA to hurry its competing actinic inspection tool – “and that’s why customers want KLA to make a reliable tool.”"

"It’s a problem to be dependent on one supplier. As a customer we always want multiple choices. Hopefully another company will provide a solution. Competition is better...The timeline you heard from KLA is reasonable. I think KLA is serious. If they can develop the tool it will be good for the industry. A year or 18 months is reasonable."

"After the MRC Committee decides on any appropriate adjustments, actual earnings (Actual STIP Earnings) and actual comparable sales results (Actual STIP Comparable Sales) are compared to the Target STIP Earnings and Target STIP Comparable Sales, respectively, and the Corporate Pool Funding (defined below) is calculated as set out below."

"By following this plan, we believe Macy's has the opportunity to create significant value for shareholders and massively improve its share price to approximately $70 per share (before value creation from further improved operations and credit card earnings), while maintaining its cash flow and real estate flexibility and reducing risk."

"The Company subsequently determined, however, to pursue multiyear upfront contracts with enterprise customers to help meet its fiscal year 2023 free cash flow goal. Upfront billings of enterprise customers in fiscal year 2023 substantially exceeded historical levels, helping the Company to meet its lowered annual free cash flow target."

"The concerns are detailed in the report we received, which include: 1) a failure to correct the H3 receptor antagonist radioligand (the foundation of the study) for metabolism, which artificially inflates the results; 2) troubling patterns in the data that "call into question the accuracy of the information presented in the PET study.""

"Spruce Point finds that Generac’s subsidiary disclosed receiving €500,000 for a sponsorship from “a company with an 50% indirect interest” and that it is owed money. We know that Alma Group was a key sponsor. Did it also have an indirect interest in Generac’s subsidiary? Generac should disclose who is the mysterious indirect interest?"

"Based on a survey conducted by the Financial Services Regulatory Authority of Ontario ("FSRA"), 62% of WFG agents reviewed were cited for contraventions of the insurance act with the most common contravention being a lack of disclosure on which insurers the agent were representing and insufficient disclosures on conflicts of interest."

"Given what we believe to be management and the Board's history of questionable decision making, how can shareholders trust the Company to rush this critical decision when management repeatedly refuses to share one of the most important assumption affecting the value that shareholders should expect to receive in a Red Lobster spin-off?"

"Looking carefully, we see that in 2020 BR bracketed “Client Platform Spend” with Capex. Moving forward, it changed its presentation to “Client Investment Spend” and then “Client Platform Investments”. BR provides limited context on these figures and spending but we can safely assume this $902 million of total costs are related to UBS."

"Bristol Meyers Squibb employee #1, a group leader: We began working with BLI years ago and have about 5 machines; still “not operational,” just “tinkering” and testing; implies it was a waste as big pharma companies tend to “blow a lot of money” on new technology; Bristol prefers to stick with cheaper, conventional cytometry machines."

"Despite Heska’s efforts to paint a picture of a transformed company, we believe the evidence (including SEC filings, supplier contracts, legal discovery, reported financials, R&D spend, capital investment, business practices, and actual product shipping in the market) indicates that Heska’s business has changed very little, if at all."

"FIGS points to its design innovation, such as bringing the 'jogger' pant style (which has existed for years in the realm of athletic wear), to the scrubs market. We do not believe such design introductions to provide a sustainable advantage. Searching for jogger pants on Uniform Advantage yields 113 options in a vast array of colors."

"What makes WTRG’s Board believe that the CEO of Lancaster Colony (a food company) is an “Audit Committee Financial Expert”? Examining his work experience dating back to 2002 shows that he held predominately food marketing roles and we find no evidence he has served on any other public company audit committee before this current role."

"In contrast to the CEO’s claim that “VW has gone all in,” VW comments strike us as ambivalent and noncommittal at best - indicating any orders/commitments would be a decade away; that they’re evaluating other solid-state players; and that it’s unclear who they’ll select, assuming that hurdles to solid-state batteries can be overcome."

"Documents from a class action shareholder lawsuit against Lumenis Ltd. allege that its predecessor ESC Medical Systems (where CEO Gerstel was VP Operations/COO) was, "a company fraught with problems, among other things poor product reliability, physician lawsuits, increasing inventories, and poor collections of accounts receivables.""

"We estimate that, at best, EPS would have been flat or modestly down without Cintas’ crafty financial and accounting gamesmanship that involved lowering its tax rate, redirecting capital towards share repurchases despite repeatedly saying it was the lowest capital priority, and lowering amortization expense for G&K service contracts."

"pitolisant is a “potent inhibitor of CYP2D6 and hERG”; “our laboratory findings suggest that CYP2D6 inhibition...would likely be important hurdles for this novel compound”; and that “in vitro profiling in our laboratory (and others) suggests that BF2.639 [pitolisant] has both a CYP2D6 liability...and potent hERG channel K+ blockade.”"

"the business combination of steelmaking coal business (Teck) and thermal-coal business (Glencore) destroys value, not only for the reasons stated by Teck, but also because Teck's coal business is not in run-off mode, whilst Glencore announced that "rundown strategy is the responsible strategy for both our business and for the world""

"IDT’s reaction was—and I think still is—just patience. IDT lowered prices a little bit in key markets like Boston and the Bay area, but IDT actively avoided going head-to-head with customers that we knew Twist was offering insane prices because we figured that either Twist is going to run out of venture capital steam and pitter out."

"We believe the competitive landscape for HIMS has become significantly more crowded over the past two years. The Company faces new threats from some of the largest online platforms in the world as well as focused upstarts targeting specific product areas. We believe HIMS' has a historical pattern of understating competitive threats."

"Aegon trades at a slight discount to its peer median. However, we believe the Company deserves a deeper discount due to the considerable operational risk that exists in its Americas segment; we do not believe the Company's sell-side analysts have given proper attention to the risk that WFG's MLM structure presents in their analysis."

"The industry go-to source PCT recently conducted a poll which indicates that 25% of the industry is now using door-to-door sales. Moreover, in 2021 an article indicated there were 7,000 door-to-door salespeople. Making some modest assumptions indicates at a minimum, 140 million doors could be knocked on by pest salespeople per year."

"I do know at least two families that dropped out of the Vykat study...both of their kids got diabetes...they were not pre-diabetic...that’s concerning to me...and both of them are still now struggling with controlling diabetes...people who take this drug – you now have another problem that you have to treat, that’s a bigger problem."

"Ex-employees, as well as other quantum computing experts who have previously worked closely with IonQ’s co-founder, stated the actual IonQ computer is “room-size, like garage size”; that its size is “like a car” and requires a separate table with a regular computer; and said it requires a “medium-sized room to operate” one machine."

"Some of these changes to the competitive landscape will be familiar to Align investors. Others will not. Spruce Point believes, however, that, taken as a whole, these developments will (and are beginning to) drive seismic shifts in the economics of the clear aligner space, which was until recently occupied by just one major player."

"From the end of 2013 to the end of 2016, Arconic invested $6.23 billion dollars in growth capital expenditures, research and development and acquisitions. For the $6.2 billion invested, Arconic generated an incremental $154 million of Net Operating Profit After Tax (NOPAT) for a Return on Incremental Invested Capital of merely 2.5%"

"We find no evidence that Kornit is hiring in Japan or has opened a Japanese office. It relies on two distributors in the country, and has only one regional manager we could identify, who has been with Kornit just one year. This suggests that Kornit is not prepared to grow with Amazon in Japan and may have already lost the business."

"Porch essentially barters its software for leads, which it then sells, yet doesn't record the transaction in cost of revenues. Given the subjectivity and managerial discretion on placing values for exchanged services in barter transactions, they have often been heavily scrutinized by the SEC and are susceptible to accounting fraud."

"With the FOIA data collected from the Florida DOT indicating a -22% decline in contact awards, and ROAD's commentary that new backlog over the period that Florida revenues ramped supported higher margins, we estimate the impact to the Company's EBITDA in FY25 to be approximately $10 - $15 million or approximately 3% - 5% of EBITDA."

"we find it concerning that Robinson spent so much time in a finance department which was shown to have cultivated a culture of fraud, serving in roles including Senior Vice President of Finance, Corporate Controller, CFO of one of CA’s subsidiaries, and Vice President in charge of internal audits (not specified on his Company bio)."

"A paper presented in January 2020 at NANS, the key annual neuromodulation meeting, indicated explant rates of 22% within 2 years and 33% within 4 years for Nevro’s product “despite repeated reprogramming sessions in the effort to achieve therapeutic optimization” – dwarfing the 1.2-3.7% rates Nevro’s own “paper” claimed by ~10-30x."

"Over the last five years, despite having a significantly profitable core Digital Telephony business, DSP appears to have managed itself to a slight operating loss (and slight EBITDA gain) almost every year, regardless of the Company's revenue, by making substantial investments in R&D and SG&A that have shown little if any progress."

"Is management really suggesting that these other tracked retailers represent no more than 4% of sales in total? Why is sales growth through tracked channels allegedly so different from sales growth through untracked channels anyways, and why is PetIQ able to so powerfully outpace the negative growth of one of its major categories?"

"The fact that a well-respected medical device company in the diabetes space sees the Libre as sufficiently accurate to include within its own closed-loop system as an exclusive partner gives us confidence that the Libre's slightly higher MARD versus the G5 and G6 is neither a significant technological nor competitive disadvantage."

"These eight CEOs were not charismatic visionaries, nor were they drawn to grandiose strategic pronouncements. They were practical and agnostic in temperament, and they systematically tuned out the noise of conventional wisdom by fostering a certain simplicity of focus, a certain asperity in their cultures and their communications."

"We believe sell-side targets do not account for the structural risks that exist in the Company due to Aegon's significant reliance on WFG to drive financial results, nor does it properly account for potential continued weakness in the international business or the potential for earnings volatility in the asset management business."

"The culture is very toxic. What's going on with firing people who speak up? I mean, that's like Theranos. I just think that it's lying about stuff that's creating an extremely toxic culture, silencing, it's basically killing off naysayers by firing them...The culture is pretty toxic. There are some really terrible things going on."

"Heska has a modest IP portfolio of five patents, including several very old Cuattro patents related to radiography for equine applications. Heska shares recently jumped when the Company filed for a patent presumably related to a new product. However, it was only for a cartridge design, and the inventor doesn't even work for Heska."

"Below is what Aerojet’s balance sheet would look like without the effect of the recent adoption. What’s clear is that its working capital trends are progressively deteriorating. Thus, in addition to the income statement benefit from the accounting change, Aerojet also conveniently appears to be masking balance sheet deterioration."

"DWAC's S-1 disclosures consistently and unambiguously state that DWAC had not "selected any specific business combination target" and had "not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us.""

"Medtech companies which produce devices cleared under PMAs (as opposed to the 510(k) pathway) are generally deemed to be protected from competition by stronger barriers to entry and, naturally, tend to trade at relatively higher multiples. So why does Penumbra trade in line with producers of devices cleared under the PMA pathway?"

"Medtech companies which produce devices cleared under PMAs (as opposed to the 510(k) pathway) are generally deemed to be protected from competition by stronger barriers to entry and, naturally, tend to trade at relatively higher multiples. So why does Penumbra trade in line with producers of devices cleared under the PMA pathway?"

"Amazon, the most dominant retailer in the world, lists Califia Farms Oat Milk as its “Best Seller”. We believe Oatly has a poor product placement on the website and is being pushed farther down on search results according to our recent tracking. We observe that Oatly’s price per fluid ounce is $0.30 cents, or 3x Pacific Oat milk."

"To estimate 2017 revenues per program, we used the following data and estimates: 2017 revenues by school disclosed in company filings, 2017 top 15 programs by new student enrollment, Tuition data (credits to complete degree and cost per credit) obtained on schools websites where available, UNC enrollment data (from FOIA request)."

"Under the new M&A guidelines, the special committee could choose its own separate independent financial advisor to come up with unbiased valuation opinions if the committee is concerned about the independence of the target company's financial advisor, according to Shinpei Ochi, deputy director of Meti's corporate system division."

"In addition to paying out a higher percentage of Retail Sales than Avon, Herbalife's commission structure varies from Avon's in two critical ways: (i) Herbalife's royalties are "flat," whereas Avon's are "descending;" and (ii) Herbalife has a Production Bonus ("infinity bonus"), Avon only pays Recruiting Rewards three levels deep"