{ "docId": "019dd923-622c-750b-8b9a-ad0811d3e80d", "docSlug": "dfcef8f28a20", "documentTitle": "Accelerate Diagnostics (AXDX)", "authorId": "61_White_Diamond_Research", "authorName": "White Diamond Research", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2019-09-16 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 37, "pageCount": 41, "prevPage": 36, "nextPage": 38, "slideType": "preempt_rebuttal", "function": "preempt_rebuttal", "density": "overcrowded", "nDataPoints": 10, "notes": "The slide uses a narrative-driven argument to discredit the 'insider buying' signal often used by retail investors.", "elementsJson": [ "paragraph", "headline_text", "quote_block" ], "metadataConfidence": 0.95, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b9a-ad0811d3e80d/37", "deckHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d", "deckJsonHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d#slide-37", "components": [ { "bbox": null, "kind": "callout", "text": "Realizing that AXDX struggles to break $10M two years after a full commercial launch, one would value AXDX as a $65M market cap business, a 95% drop from its current valuation.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-8a7402191540", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "metric", "text": "market cap: $65M", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-91858c8d530d", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.78, "x": 0.11, "y": 0.59 }, "kind": "paragraph", "text": "Schuler and Feinberg have had some successes many years ago, such as in the 1990s, they invested in startups like Stericycle (SRCL) and Ventana. However, over the past few years they have been involved in some stinkers and penny stocks. Such as Biolase (BIOL) and Yield10 (YTEN). Here is a 2014 letter from the former CEO of Biolase, announcing his resignation. He declared:", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "04b15df1-2aa2-4381-983e-f3e3a99e3ac0", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.25, "w": 0.78, "x": 0.11, "y": 0.09 }, "kind": "paragraph", "text": "Some investors like to compare AXDX to BioFire Diagnostics, which was acquired by BioMerieux for $450M+debt in 2013. They add that BioFire did not even have AST data. What these optimistic investors forget is that at the time of its acquisition BioFire had almost $70M in annual sales. So BioMerieux was not purchasing a promising technology, but the sizable revenue at a 6.5x multiple. Realizing that AXDX struggles to break $10M two years after a full commercial launch, one would value AXDX as a $65M market cap business, a 95% drop from its current valuation .", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "1fa4fb86-c333-49ec-961b-166c891d65ec", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.78, "x": 0.11, "y": 0.81 }, "kind": "paragraph", "text": "Today, BIOL’s share price is at an all-time low, with a market cap of only $20M.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "aa90cf63-0b4a-4e86-9670-000bdeb78aa3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.78, "x": 0.11, "y": 0.4 }, "kind": "paragraph", "text": "Schuler has consistently made insider buys of AXDX, which have historically caused the stock to rally. He made a large purchase on 5/20/19 of 50K shares at $19.03 apiece. AXDX subsequently went as high as $24 on 7/3/19 before fading back down. AXDX had gone as low as $15.60 on 8/9/19 after its disappointing Q219 report. On 8/12/19, Schuler purchased a smaller amount of 10K shares at $17.45 apiece. This sparked another rally and the stock went as high as $19.55 on 8/29/19.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "dd79dc6e-97a2-40d1-bdbc-84e87371148f", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.78, "x": 0.11, "y": 0.72 }, "kind": "quote", "text": "My decision to resign follows a protracted campaign by a majority of the Board, controlled by and acting under the direction of Oracle Partners (Oracle) (BIOLASE's largest stockholder) and Larry N. Feinberg (Oracle's Managing Partner)", "attrs": null, "subkind": "pull-quote", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0eeba309-7365-4883-aa5b-70668efd08ce", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "My decision to resign follows a protracted campaign by a majority of the Board, controlled by and acting under the direction of Oracle Partners (Oracle) (BIOLASE's largest stockholder) and Larry N. Feinberg (Oracle's Managing Partner) — Former CEO of Biolase", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-8dad13ef5895", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.07, "w": 0.78, "x": 0.11, "y": 0.32 }, "kind": "title", "text": "Shuler’s and Feinberg’s stock purchases is not an indication of AXDX future success", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fe004410-c23f-431a-8080-e225f74a921d", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "preempt_rebuttal", "slug": null, "matchId": "ab4ed974-64e5-4ef6-b788-07ad1f2fc1bc", "evidence": "The slide explicitly addresses and refutes a common investor argument (insider buying as a positive signal).", "confidence": 0.9 } ], "arcBeats": [ { "to": 41, "from": 30, "beatId": "ca57db9c-677e-4ef8-919c-92b1690ee48e", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Solution (Provide relief)", "beatSlug": "problem-agitate-solution-solution-provide-relief", "evidence": "The document implies that the solution is to be cautious of the system's limitations and avoid investment in AXDX, citing a potential decline in AXDX shares.", "position": 2, "confidence": 0.8, "parentBeatName": "Resolution", "parentBeatSlug": "resolution" } ], "loops": [ { "to": 40, "from": 36, "name": "So What Cascade", "slug": "41-so-what-cascade", "bestFor": "Data presentations, executive summaries, driving to recommendations", "matchId": "4a0cc194-140e-4021-ac97-526c652944fe", "evidence": "The document presents a cascade of implications, including a potential CEO replacement, market guidance downgrade, and decline in AXDX shares.", "position": 2, "objective": "So what does this mean for AXDX's future?", "structure": "The Data -> So What? 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