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  "documentTitle": "IQE plc (IQE)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
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  "presentationDate": "2018-02-08 00:00:00",
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  "notes": "The slide uses a skeptical tone to link accounting practices with insider trading activity.",
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      "text": "IQE insiders have financially benefitted from recent sales of shares at prices significantly higher than prior to CSC's commencement.",
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      "text": "From October through December 2014, IQE insiders Messrs. Nelson, Rasmussen, Williams, and Ainsworth acquired a total of 20.5 million shares at a weighted average price of £0.13 (total £2.6 million). This was soon before IQE's joint ventures started transacting with IQE. Between May 2017 through July 2017, these insiders sold £7.8 million of shares (7.18 million shares at an average price of £1.08).",
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      "text": "We note that while cash outflows for capitalized investments in intangible assets increased by 108.7% from 2H 2016 to 1H 2017, amortization of intangible only increased 12.5% from £2.4 million to £2.7 million.",
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      "text": "IQE received significant accounting benefits from CSC. These benefits came at a cost of millions of pounds to the university. IQE insiders have financially benefitted from recent sales of shares at prices significantly higher than prior to CSC's commencement. The university should ask whether the benefits it is receiving are worth the cost. In the meantime, shareholders should ask whether IQE's financial performance since 2015 can be sustained.",
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      "text": "We understand that Cardiff University, Wales, and the UK government see IQE as an important part of the noble enterprise of creating highly skilled jobs in the region. We genuinely wish them all the best in this endeavour and hope it will be extremely successful. None of those feelings, however, can alleviate our concern that Cardiff University has not been shrewd enough in its dealings with IQE.",
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      "text": "A sceptic might view the purchases not so much as prescient, but rather as insiders understanding of the type of accounting gains IQE stood to make from the joint ventures. A sceptic might also view the monetization around the close of 1H 2017 – a period in which we suspect IQE could have been unsustainably aggressive in its accounting – as signalling the company is unlikely to be able to continue to produce such gains with CSC's funding largely spent. On the other hand, maybe this is all a coincidence.",
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      "text": "Source: IQE Company Filings",
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      "text": "4 All share transaction data sourced from Bloomberg.",
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      "text": "Development Costs, Investment in 'other' intangibles, Total intangible 'investments', Dev't Costs/Total Intangibles",
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      "text": "Insider Share Transactions Bookend JV Earnings Magic",
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