{
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  "docSlug": "42a707289390",
  "documentTitle": "Maxar Technologies (MAXR)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2018-08-07 00:00:00",
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  "pageNumber": 25,
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  "density": "dense",
  "nDataPoints": 45,
  "notes": "Uses a peer benchmark to expose accounting aggressive behavior.",
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      "kind": "callout",
      "text": "Is Maxar a world leading technology company, or does the evidence strongly suggest aggressive capitalization of technology development costs to inflate earnings? Spruce Point believes the evidence suggests earnings inflation. Maxar’s competitors on average ascribe 19% of intangibles to technology, not >50%. By normalizing MAXR’s results to peers, we estimate $50m of annual overcapitalization of intangibles. (1)",
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      "kind": "callout",
      "text": "By normalizing MAXR’s results to peers, we estimate $50m of annual overcapitalization of intangibles.",
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      "kind": "metric",
      "text": "intangible asset capitalization: $50m",
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      "kind": "source-note",
      "text": "1) 19% of 2016 Gross Intangibles ($512m) =$97m. Take the current technology and in process account of $299m and deduct $97m = $201m. Divide $201m by four to reflect the four years leading up to the DigitalGlobe acquisition =~$50m/year",
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      "kind": "table",
      "text": "MDA's Developed and In Process Technologies To Gross Intangible Assets Grew Every Year Pre-Maxar",
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      "kind": "table",
      "text": "Competitors on Average Ascribe 19% of Gross Intangibles To Technologies + in Process R&D",
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      "kind": "title",
      "text": "Inflation of Intangible Asset Capitalization Overstates Earnings",
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      "evidence": "The document compares Maxar Technologies' financials to those of its peers.",
      "position": 1,
      "objective": "Highlight Maxar Technologies' financial struggles compared to peers",
      "structure": "The Giant's Weakness -> Our Slingshot (Unique Edge) -> The Topple",
      "confidence": 0.7,
      "description": "Frame your initiative as the nimble underdog taking on a slow, bloated incumbent"
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