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  "documentTitle": "PROCEPT BioRobotics Corporation (PRCT)",
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  "notes": "Uses a causal chain framework to link operational metrics to a conclusion of excess inventory.",
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      "text": "No net procedure growth and likely smaller than estimated volume opportunity.",
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      "kind": "callout",
      "text": "2.6 quarters of handpieces in finished goods inventory (assuming no systems). Also, DIOs have risen 33% from 164 in Q4 2023 to 218 in Q3 2024. (1)",
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      "text": "DSOs now exceed the high end of Company 30 to 90 day payment terms.",
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      "text": "Procept and Its Hospital Customers Are Stuffed With Excess Handpieces",
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      "text": "What do you get when you combine rising DSOs (potentially resulting from sales incentives), all-time high finished goods inventory (we believe likely comprised largely of handpieces), flat system utilization (ie, flat handpiece consumption), and a smaller than estimated procedure volume market? We believe too many handpieces at Procept and its hospital customers.",
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      "text": "(1) While we assume no systems in finished goods inventory to simplify the analysis... Source: Procept SEC filings, previously footnoted academic research and government data sources, Spruce Point research",
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