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  "documentTitle": "Sunnova Energy International Inc. (NOVA)",
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  "authorName": "Spruce Point Capital Management",
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  "presentationDate": "2020-09-29 00:00:00",
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  "notes": "Uses a testimonial/quote from a former executive to undermine the company's preferred financial metric.",
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      "kind": "callout",
      "text": "Is Adjusted EBITDA the correct way to evaluate Sunnova’s financial performance?",
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      "text": "Is Adjusted EBITDA the correct way to evaluate Sunnova's financial performance?",
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      "text": "Adjusted EBITDA",
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      "text": "According to a former Sunnova executive and other industry experts, Adjusted EBITDA is not the correct metric to evaluate the business and core earnings (interest income – interest expense – operating expenses) is a better metric. We believe the market may be incorrectly analyzing the performance of Sunnova’s business by using Adjusted EBITDA. In addition, a recent SEC Comment Letter shows evidence of aggressive use and calculation of Adjusted EBITDA(1). We believe core earnings paints an accurate and different picture.",
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      "text": "No, it's not. What you'll see used is a traditional specialty finance company investment model where you use core earnings. All specialty finance companies and really all banks use core earnings. Core earnings takes all interest income, subtracts interest expense, subtracts operating expenses and then divides that by equity and that is what the core return on equity and that's how these businesses really get valued.",
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      "text": "\"No, it's not. What you'll see used is a traditional specialty finance company investment model where you use core earnings. All specialty finance companies and really all banks use core earnings. Core earnings takes all interest income, subtracts interest expense, subtracts operating expenses and then divides that by equity and that is what the core return on equity and that's how these businesses really get valued.\" — Former Sunnova Executive",
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      "text": "1) SEC.gov\nSource: Spruce Point research",
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      "text": "We Believe Adjusted EBITDA Is Not Where Investors Should Be Focused",
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