Fortnightly Publication Highlighting Latest Insights From IRF Providers
Company Research
Communications
Paragon Intel takes a negative view on CEO Sundar Pichai, arguing that his slow, consensus-driven leadership style has left the company “fast following” in an AI race it should be leading. While Pichai’s long-term vision and product instincts built successes like Chrome and Android, and his tenure has delivered impressive financial results, his risk aversion, conflict aversion, reluctance to refresh senior leadership and indecisive response to competitive threats like ChatGPT have led to internal stagnation. Paragon’s analysis includes interviews with 6 former Alphabet executives, who portray him as a thoughtful strategist and capable steward, but ill-suited to the fast, “wartime” pace the AI era demands.
Edition: 223
- 31 October, 2025
Dassault Systemes (DSY FP) France
Technology
Paragon’s Executive Diligence Memos highlight a bearish view of DSY’s Chairman Bernard Charles and CEO Pascal Daloz. While Charles’ visionary approach was instrumental in building the company, his controlling management style will hinder the necessary commercial agility and cultural change, making his continued deep involvement the primary obstacle to DSY’s future performance. Meanwhile, Daloz's plan involves methodical, incremental process improvements and evangelising a long-term AI vision, but his non-confrontational style is ill-suited for driving the disruptive change that is urgently needed. Since Daloz took over, deal slippage has doubled, forcing the company to offer more favourable payment terms to secure deals. This culminated in management cutting the FY25 OCF outlook, a move that has shaken investor confidence.
Edition: 221
- 03 October, 2025
Technology
Richard Windsor argues SoftBank’s $2bn investment in INTC, alongside a potential 10% US government stake, may keep the company alive but does little to resolve its strategic paralysis. INTC faces a stark choice: either invest heavily to catch up with TSMC or break up the business - yet under new CEO Mr. Tan, neither path is clear. The board abandoned Pat Gelsinger’s catch-up strategy due to mounting costs, leaving INTC exposed to further share losses in PCs (to AMD and Qualcomm) and in data centres (to Nvidia and AMD). Richard warns that without decisive strategy, customer confidence will erode, competitors will gain share with ease and capital injections alone cannot avert decline. He sees no attractive entry point in INTC shares.
Edition: 218
- 22 August, 2025
Healthcare
Paragon interviewed 7 former senior executives at ATS who worked with BAX's new CEO, Andrew Hider, for more than 36 years combined. Feedback was universally positive. Hider is a disciplined, process-driven leader who blends Danaher-style operational rigour with strong communication and an ability to scale businesses via organic growth and M&A. At ATS, he drove cultural transformation via the ATS Business Model, delivering margin expansion and shareholder returns, though his intense stretch targets and competitive nature created a high-pressure environment that could limit collaboration and agility. His success at BAX will hinge on whether he can balance his relentless operational focus with greater strategic flexibility and adaptability to the slower-moving, more regulated dynamics of the pharmaceutical industry.
Edition: 218
- 22 August, 2025
Healthcare
CEO Tom Polen’s leadership has damaged BDX’s culture and weakened long-term performance, according to Paragon's analysis which includes interviews with former senior executives, who worked with Polen for more than 51 years combined. Critics described him as an overconfident micromanager, too reliant on loyalists and resistant to course-correct when bold initiatives underperform. His emphasis on appearances and short-term results strained organisational culture, led to talent attrition and undercut long-term innovation. Under his tenure, BDX’s stock has declined 28%, destroying over 70% alpha. The group would be better served by a leader with stronger executional discipline and cultural stewardship.
Edition: 217
- 08 August, 2025
Flutter & DraftKings: Bespoke CEO project
Consumer Discretionary
Paragon Intel is launching a bespoke CEO assessment project on FLUT’s Jeremy Jackson and DKNG’s Jason Robins. While both leaders boast headline achievements, they now confront converging pressures - higher state betting taxes, rising CAC, regulatory scrutiny and complex integrations. With Robins shifting focus towards FCF generation and Jackson tasked with defending FanDuel’s margin edge amid intensifying competition, Paragon will evaluate whether each CEO possesses the capital-allocation discipline, governance model and operating rigour to convert scale into durable profitability. They will also explore how differences in ownership control impact succession, strategic agility and shareholder alignment as the US sports betting market matures.
Edition: 216
- 25 July, 2025
Consumer Discretionary
Paragon Intel adds BBWI’s new CEO Daniel Heaf to their research pipeline. He earned his reputation as a digital builder, but his tenure at Nike was marked by inventory issues, cost cuts and a leadership shake-up that ultimately eliminated his role, while the stock underperformed the S&P 500 by ~40 percentage points. He now steps into a retailer that has cycled through 3 CEOs in 3 years and watched FY24 revenue slide 7% to $7.3bn, even as it courts a broader demographic appeal and eyes faster international growth. Paragon’s work will examine whether Heaf’s omnichannel playbook can reignite top-line momentum, widen margins and restore investor confidence, while also weighing governance stability and the risk that NKE-style missteps resurface as BBWI charts its next phase.
Edition: 212
- 30 May, 2025
Communications
New CEO Spencer Rascoff is a high-capacity multi-tasker primed to rebuild consumer trust and female engagement. He served as CEO of Zillow from 2010-2020, scaling the business into the leading US online real estate platform. While not a product visionary himself, he is a detail oriented entrepreneurial risk taker who will inculcate a faster paced culture of innovation at MTCH. Rascoff has a knack for emphasising authentic user experience over monetisation (short-term) with an eye towards building a more trusted relationship with customers. Paragon’s analysis includes interviews with 7 former senior executives who worked with Rascoff for more than 85 years combined.
Edition: 210
- 02 May, 2025
Technology
Richard Windsor says MediaTek’s Kompanio Ultra chip sets a new standard for the high end of the Chromebook market and looks to be merely a stone’s throw from Intel and Advanced Micro Devices facing another newcomer in the PC Market. The biggest winner will be Arm, which will see its penetration of PCs accelerate and it will earn higher royalties from MediaTek which buys the processor design and licences the IP. This is neutral for Qualcomm because competition in this space is healthy and will keep the firm on its toes and push it to continue to lead when it comes to performance. INTC and AMD are the real losers here as the x86 architecture looks increasingly obsolete.
Edition: 209
- 18 April, 2025
Industrials
New CEO Joakim Weidemanis will improve operations and energise growth at JCI, according to Paragon’s analysis which includes interviews with former colleagues who worked with Weidemanis for more than 47 years combined. Sources provided mostly positive feedback (five positive, one neutral, one negative) and agreed that his leadership, integrity, financial acumen and disciplined focus make him an excellent choice to lead the company. Weidemanis actively empowers his managers to succeed and draws on a history of working for global industrial conglomerates to improve operating efficiency, drive growth and divest underperforming assets.
Edition: 209
- 18 April, 2025
Consumer Discretionary
New CFO Cath Smith has destroyed a total of (192%) alpha at seven different public companies since 2005. Her below-average ManagementTrack Rating of 3.0 is a downgrade to outgoing Rachel Ruggeri's MTR of 4.3 and will lower SBUX's C-Suite Rating despite CEO Brian Niccol's 8.1 MTR. Smith is classified as a: 1) "Capital Returner" Capital Allocator: 59% of career capital allocated towards Dividends and Buybacks. 2) High F.L.A.G. Risk Concern with a "Bad Compliance Record". 3) Inconsistent Guidance Forecaster: beats 35% of guidance given, misses 17%, in-line 48%. 4) Less Evasive on earnings call Q&A: during her Nordstrom tenure, JWN was ~27% evasive vs. SBUX's C-Suite ~33% evasive over the past five years.
Edition: 206
- 07 March, 2025
Technology
Forensic Alpha sees several new accounting red flags emerging, earning the stock a ‘high risk’ label. The two key areas of concern revolve around an accounting policy change (the point at which INTC can capitalise inventory on the balance sheet seems to have completely changed) and an increase in payables (from $8.6bn to $12.6bn, while other accrued liabilities have risen from $12.4bn to $14.3bn. Combined, these balances now amount to a massive $26.9bn, or 64% of net debt). They expect to see increasing scrutiny of the cash flow statement as restructuring efforts unfold in 2025.
Edition: 204
- 07 February, 2025
Technology
Paragon has developed an Outlier Evasive Earnings Call model to provide investors with predictive insights into a company’s stock performance based on the evasiveness of earnings call transcripts. They flagged SNX's recent earnings Q&A as being a Predictive Outlier (patterns of evasion that indicate negative alpha over the next 180 days and these flags generate 9% annual alpha based on 10 years of data). The last time a Predictive Outlier was flagged for SNX was in 3Q24 and the stock had (18%) alpha over the following 180 days.
Edition: 203
- 24 January, 2025
Technology
The “ouster” of Pat Gelsinger will almost certainly result in INTC being split up, meaning the once all-powerful brand may soon be just a memory. With the company’s future very uncertain and its once great engineering culture in poor shape, INTC is easy pickings for its resurgent competition. Richard Windsor expects to see Qualcomm, AMD and MediaTek redouble their efforts in PCs and the data centre. He has often said that at 10x earnings, one should shut one’s eyes and buy the stock, but because of the falling EPS estimate the valuation has never gotten there. With the company in this much trouble, there is no price at which he would want to buy it.
Edition: 201
- 13 December, 2024
Consumer Staples
CFO Nik Jhangiani will help spur the company’s rebound with his technical skills and ability to drive change. He previously worked at Coca-Cola Europacific Partners, where he streamlined operations, oversaw large acquisitions, and ensured those deals and other investments earned value-creating returns. He also excelled at investor relations, which will be helpful for a company that has underperformed for two years under CEO Debra Crew’s tenure as COO and CEO. Paragon’s analysis includes interviews with former colleagues of Jhangiani. Sources were universally positive. The only reason he will fail, they said, is if others in the DGE organisation actively resist his programmes.
Edition: 201
- 13 December, 2024
Technology
Tomer Weingarten’s declining engagement and mercurial behaviour a poor fit for a public company CEO - Paragon’s analysis includes interviews with former senior executives who worked with Weingarten for more than 18 years combined. They described him as volatile and abrasive, lacking integrity and prone to impulsive decision making, which has led to the departure of a previously strong C-suite. Repeated shifts in financial guidance have lowered his credibility with investors, with sources noting the company would be better off acquired or run by a new CEO, although neither option is likely given Weingarten’s control of the board and voting shares.
Edition: 200
- 29 November, 2024
Consumer Discretionary
New CEO Jim Conroy added to Paragon’s research pipeline - Conroy joins ROST from Boot Barn, where he created 640% alpha as CEO since 2012. However, his ManagementTrack Rating of 5.7 is a modest downgrade vs. the outgoing CEO Rentler's MTR of 7.0. Other stats include: Conroy is a "Builder" capital allocator: 70% of career capital allocated towards CapEx (Rentler is a "Capital Returner", allocating 69%+ towards Dividends & Buybacks). Conroy is an "Inconsistent Guidance Forecaster": Beats 49% & Misses 39% of the time (Rentler is a "Guidance Sandbagger": Beats 87% & Misses 7%). He has a low F.L.A.G. Risk Concern and very low historical Earnings Call Q&A Evasiveness (Conroy averaged 10% vs. Rentler's 27% over the last 5 years).
Edition: 198
- 01 November, 2024
Earnings Q&A evasion analysis
Paragon’s latest offering on their ManagementTrack platform highlights evasive answers near real-time during earnings seasons. Their model can also flag abnormally high evasiveness % and if past instances have led to underperformance. Recent examples include 1) Lamb Weston - management's evasiveness increased significantly to 60% from 25% and 33% the prior 2 quarters. 2) McCormick - evasiveness increased to 36% from sub-10% the prior 2 quarters. 3) Disney - last quarter executives answered 78% of questions evasively. 4) Click here to access a report Paragon created overlaying their earnings call analysis with a recent note a short seller published on Roblox.
Edition: 197
- 18 October, 2024
Healthcare
Paragon’s analysis of CEO Bryan Hanson includes interviews with ten former colleagues who worked with him at Zimmer Biomet, Covidien and Medtronic for 110 years, combined. Sources (6 positive, 2 negative, 2 neutral) focused on his strengths as a builder of culture and teams. He begets loyalty in those who work with him, has a high level of transparency and strong communication skills. In fact, his focus on company culture may overshadow other areas, as he and those around him can become absorbed in the excitement of cultural transformation and big-picture ideation at the expense of more disciplined strategy. All the same, Hanson will take a portfolio management approach to SOLV, honing core areas of the business through both divestments and tuck-in acquisitions.
Edition: 196
- 04 October, 2024
Tracking the mutual funds tax selling
Quantitative Partners with Phil Erlanger Research
Geoff Garbacz thinks this might be the most important data point to follow to determine if we continue to see a stock market rally. Stocks vulnerable to tax selling include Boeing, Intel, Rio Tinto, Stellantis and UPS. Click here to watch the video which also includes the key levels to monitor on the S&P 500.
Edition: 193
- 23 August, 2024
Financials
Enrique Lores replaces John Donahoe as Independent Board Chair. Lores has overseen more than 98% alpha destruction as a member of PYPL’s board since he joined in 2021 and has not created alpha as a CEO nor a board member in his career. In 2023 he received a "Bad Compliance Record" tag because of his "Level 3" Disclosure Controls and Internal Controls F.L.A.G. (Financial, Legal, Audit, Governance) Risks at HP Inc. Paragon also cautions about his incentive compensation - after only hitting 56% of his incentive targets from 2020-2022, Lores was able to convince the board to materially lower his 2023 incentive thresholds...and he was able to meet or beat all of those targets last year.
Edition: 192
- 09 August, 2024
Consumer Staples
CFO-Elect Monish Patolawala's ManagementTrack Rating* of 0.8 is in the bottom 4% of the 1,250 CFOs on the platform and is a significant downgrade to the 5.3 MTR of ADM's existing C-Suite. Patolawala destroyed (113%) alpha as a CFO at 3M; he has 9 "Level 2 & 3" career F.L.A.G. Risks (Financial, Legal, Audit, Governance Flags); a mixed incentive hit rate (achieved 50% of his incentive compensation targets 2020-2023); and is classed as an Inconsistent Sandbagger Guidance Forecaster (beats 51% and misses 28% of his financial guidance to investors).
*The MTR model employs a statistical ML algorithm to predict executive / company outperformance relative to their sector. It utilises 200+ signals and over a 10-year back-test a MTR long-short portfolio generated an average annual alpha of 8% with a 90% hit rate.
Edition: 190
- 12 July, 2024
Pressure is making life very hard for Chinese semiconductors
Technology
While SMIC blamed domestic competition for continued gross margin weakness, Richard Windsor suspects the real issue is to be found at the “leading edge” where it is using a multi-patterning technique to manufacture at 7nm and 5nm. Both Intel and TSMC tried to do multi-patterning for 7nm and abandoned it because the yields were so low that it was not economical to continue. China’s semiconductor industry can make products at much higher cost, but the state will need to support the industry which is becoming increasingly difficult as China’s economy limps along. Furthermore, Chinese technology will no longer be the cheaper option making Western products and standards more competitive in African, South East Asian and Latin American markets.
Edition: 186
- 17 May, 2024
Industrials
Incoming CEO Thomas Gentile appears to be a downgrade to the already under-performing CEO seat at HXL with (147%) career alpha destruction compared to Nick Stanage's (77%). While Gentile brings less "Level 2 & 3" F.L.A.G. Risks than Stanage; his 14 is still considered to be high across all the executives on Paragon’s ManagementTrack platform. Investors should not expect more consistency in trusting guidance from Gentile - he was classified as an “Inconsistent Forecaster” during his tenure as CEO at Spirit AeroSystems. Furthermore, he does not possess a track record as a C-Suite executive of increasing revenue or margins - at SPR revenue declined (26%) and Adj. EBITDA margins declined by (1,470 bps). He left the firm after production problems resulted in the shares declining more than (40%).
Edition: 184
- 19 April, 2024
Consumer Discretionary
Kevin Kwilinski is not a long-term focused CEO and is likely to falter because of his deeply-flawed people skills - his biggest weakness, interpersonal communication, will be a major impediment to his ability to get things done. 1) Even the best laid plans struggle to come to fruition when the team is not committed. 2) He has stated an intention to expand globally but he may not be conscious of cultural nuances when forging partnerships. 3) His abrasive decision-making has jeopardised client relationships in the past. 4) His tendency to blame others and push the boundaries of acceptable business practice leads to attrition and lack of trust, even from investors.
Edition: 182
- 22 March, 2024
Communications
CEO Bill Ready underwhelms against heightened expectations - Paragon Intel’s thesis is that Ready struggles with monetisation and that while they expect him to drive an increase in velocity of product development, he will be unable to fundamentally alter PINS growth trajectory because the company's desire to become a shopping hub is due to its business model needing that to happen vs. minimal demand from online shoppers. Paragon expects Ready will grow MAUs 4-6% and ad load per hour 3-5%, but fail to move the needle on user engagement, which will grow just 0-2%. As a result, ARPU per MAU will grow 5-10% annually to reach just $7.01-7.70 in 2024.
Edition: 180
- 23 February, 2024
Consumer Staples
Tim Cofer will extend his proven track record of growing corporations organically by capturing market trends and creating economies of scale as well as driving profits inorganically through M&A. Paragon Intel interviewed former colleagues who worked with Cofer for more than 30 years combined. Sources gave him the highest rank for his strategic acumen and fitness as a CEO. However, this praise is somewhat offset by the beliefs of some that he lacks transparency and can be arrogant. Paragon likes the appointment. They believe Cofer’s ability to create a very cohesive and forward-looking strategy makes him well suited to lead KDP.
Edition: 177
- 12 January, 2024
Industrials
Paragon Intel is positive on UNP’s new external CEO, Jim Vena, who took the reins earlier this year after a 17-month search. They believe the industry veteran will surprise sceptics by balancing early gains in operating efficiencies with volume gains driven by better service in a tougher labour and regulatory environment. Paragon’s research includes interviews with Vena’s former colleagues who worked with him for more than 90 years combined - there was only one critic - who cautioned that he lacks experience dealing with US regulators.
Edition: 175
- 08 December, 2023
Industrials
John Dietrich is an unconventional pick for CFO because he has never overseen a finance function before, but his pre-existing relationships with the FDX team, general industry knowledge and overall strong execution inspired them to bring him into the C-suite. He is charismatic, humble and approachable, and creates loyalty among those on his team. Dietrich will capably guide the ship through choppy waters as FDX struggles against a shift from a goods economy to a service economy and a post-pandemic e-commerce reset. His primary focus will be on efficiency / cost-cutting and he will lean heavily on his prior experience negotiating with the pilots’ union to extract a favourable deal.
Edition: 172
- 27 October, 2023
Industrials
Paragon Intel has published its Executive Diligence memo on RBA's new CEO Jim Kessler, who took on the role in Aug having been COO since 2020. An approachable and grounded executive, he melds strong financial understanding with an excellent ability to execute, which he will leverage while driving legacy RBA results and the integration of the broadly criticised IAA auto salvage acquisition. Paragon’s research includes interviews with 7 former colleagues who worked with Kessler for >27 years combined (5 were positive and 2 neutral) - sources who worked with him at Caliber Collision were the most positive, followed by RBA and then vRide.
Edition: 171
- 13 October, 2023
Consumer Staples
New CEO Hein Schumacher will have a hard time creating shareholder value as he is stretching beyond his depth during a time of intense household budgetary pressures, rising input costs and pressure from an activist investor. Although Schumacher has global experience, ULVR is several times larger than any business he has previously run and faces specific challenges (margin pressure, a new operating structure and decisions on which long-term brands to own). Paragon’s research includes interviews with Schumacher’s former colleagues; while they gave him the highest rating for financial acumen and integrity, this was countered by his abrasiveness and weak self-awareness.
Edition: 167
- 18 August, 2023
Consumer Discretionary
Fish-out-of-water CEO will struggle to build long-term value - Paragon’s sources provide negative feedback on Chris Cocks who describe a leader with disdain for the core fanbase and contempt for subject matter expertise. He follows his gut rather than data or the advice of those in specialist roles and builds a deeply negative company culture rife with burnout and attrition. Cocks will focus on streamlining the company’s operations and “doing fewer things better,” but he has neither the finger on the pulse of the fanbase nor the maverick vision to turn around a company that has struggled to expand its market share.
Edition: 165
- 21 July, 2023
Bayer (BAYN GR) Germany
Healthcare
Evidence suggests new CEO Bill Anderson will use R&D, M&A and transformation to grow earnings - Paragon interviewed former colleagues who worked with Anderson at Genentech and Roche for over 75 years combined. Sources were unanimously positive, citing his knowledge, leadership abilities, management style and ability to drive results at both companies. Following his appointment, all but one source would consider investing in BAYN with the one hold out citing concerns about the cultural differences between a traditional German company and a new CEO with an informal, “Californian” management style.
Edition: 164
- 07 July, 2023
Technology
Evidence suggests new CEO Carl Eschenbach will profitably scale WDAY to over $10bn in sales - a legendary enterprise software leader, he will boost the group’s go-to-market capabilities, driving greater cross selling of Financial Management software, accelerating international growth, optimising organisational effectiveness and driving margin expansion. Eschenbach is one of the most strongly endorsed CEOs that Paragon Intel has analysed, with all sources uniformly praising him, including all six former colleagues protesting when asked if he had any weaknesses, a first in Paragon’s research process.
Edition: 163
- 23 June, 2023
Connectivity, speed & scale combine to blow up IT as we know it
Technology
In John Harrington’s latest Tech Trends report, he looks at several factors that have combined to change IT development and sales dynamics. These include how the accelerating deployment of speedier wired and wireless connectivity to the cloud, very fast computing platforms being built at scale within the clouds, the accelerating development of quantum computing as a viable commercial business, and the development of serious AI capabilities are affecting the global digital landscape. As IT increasingly transitions from in-house networking to the cloud, some new areas of IT will benefit, while others face an uncertain future.
Positive: Advanced Micro Devices, Alphabet, Apple, Amazon, Broadcom, Ciena, Dycom, Intel, IonQ, Microsoft, Nvidia, Rigetti.
Negative: C3.ai, Cisco, Dell, Qualcomm, Salesforce.
Edition: 162
- 09 June, 2023
Technology
A multi-month deep-dive into Rob LoCascio including conversations with more than 12 former colleagues paints a picture of a CEO who is unfit to be in the seat. Paragon Intel’s sources revealed that LoCascio can be a patronising bully who has created an intimidating culture. He lacks the strategic focus required of CEO and his desire for fame makes him a worse operator. Sources repeatedly spoke about LoCascio blurring the lines between his personal endeavours and company resources. His ManagementTrack Rating of 2.3 is one of the lowest on Paragon’s platform.
Edition: 160
- 12 May, 2023
Consumer Staples
New CEO David Flitman to drive margins and profits higher - former colleagues interviewed by Paragon described Flitman as a strong operator who excels at driving costs out of businesses. He is a rigorous, data-driven, and profit-focused executive who quickly understands the largest levers to pull to improve performance at distribution businesses. He drove significant shareholder value at BMC and its merger partner Builders FirstSource where the combined stock performance of the two companies outperformed the S&P 500 more than two-fold.
Edition: 159
- 28 April, 2023
Communications
Not only is Paragon Intel negative on CEO Kate Johnson’s ability to turn around the company, but their work suggests she is one of the most ill-equipped executives they have researched in their history to be in the specific CEO-seat! Paragon’s report is split into two documents: CEO Diligence Memo and CEO Interviews. Former colleagues questioned her lack of experience making capital allocation decisions and an inability to get in-depth on technical issues. They also pointed to an egocentric, insecure executive with “sharp elbows” who surrounds herself with like-minded colleagues, diminishing her credibility as a force for cultural change.
Edition: 155
- 03 March, 2023
Technology
Code red - INTC reported a truly awful set of numbers, declined to guide for 2023 and appears to be losing market share left, right and centre. Richard Windsor thinks there is a good chance that INTC will need more capital. He argues management should cut the dividend and sell its stake Mobileye (he believes INTC has 24 months to dispose of its stake before the share price collapses). INTC could post negative EPS this year meaning that there is very little to support the share price from a valuation perspective now.
Edition: 153
- 03 February, 2023
Technology
Having conducted 34 interviews on CEO Tobi Lutke and his management team (Paragon’s sources worked with these executives for 162 years combined), evidence suggests he lacks the operational acumen to oversee SHOP’s continued growth. Worrying traits include a disdain for expertise, lack of short- and medium-term vision, dearth of processes and professionalism, poor people management, and potential risk management issues around HR and data security issues. Management practices that worked when SHOP was a small start-up will not enable the company to scale.
Edition: 153
- 03 February, 2023
Technology
Inflection Point Research, LLC
NVDA's dominance in AI workloads, both in cloud computing infrastructure and other implementations, remains very much intact - Michael Fox believes the bevy of current start-ups will have a steep uphill climb to get any traction in high volume AI deployments (i.e. cloud), and while Advanced Micro Devices and Intel have competing solutions that look good on paper, both fall short in ecosystem and support. Ultimately, Michael expects the real competition for NVDA’s dominance will come from internal chip developments at the hyperscalers. Fortunately for NVDA, any true competition is years down the road.
Edition: 149
- 25 November, 2022
Financials
FTX’s collapse sparks interest in the different actors in the crypto space - Paragon to begin vetting COIN’s CEO Brian Armstrong and CFO Alesia Haas. While they have no reason to believe that anything not "above-board" is occurring at the company, key executive departures, large insider selling, and self-assessed internal controls in a very volatile asset class should always require further examination.
Edition: 149
- 25 November, 2022
Communications
New CEO Bernard Kim will rejuvenate Tinder and refocus MTCH’s product roadmap - to reaccelerate growth, Kim will drive better-than-expected payer and revenue-per-payer growth by applying his mobile gaming expertise, introducing new product features, and more efficiently balancing investments in high ROI properties. A forward P/E of 19x, sets up a more compelling risk:reward today than at any point since the stock went public in 2015. Adjusted EPS to increase to $3.83-$4.11 in 2024, which is 14%-22% higher than consensus of $3.37.
Edition: 147
- 28 October, 2022
Consumer Discretionary
Decision to hire Laxman Narasimhan as the new CEO could be a mistake - Paragon’s previous diligence report includes interviews with 18 former colleagues, all of whom found him to be arrogant, self-centred, insecure, and abrasive. As a result, he destroys company culture and is not well-liked. Furthermore, he lacks the ability to execute on a long-term strategy. At Reckitt he underperformed as CEO (destroyed 17% alpha for shareholders), performance they believe stems from a "lack of deep understanding of the business”. Paragon will be supplementing their previous work on Narasimhan with interviews with former colleagues at Reckitt.
Edition: 144
- 16 September, 2022
Technology
Evidence suggests CEO Schulman is not the leader to put out the fire he started - has missed numerous opportunities to keep the company ahead of an ever-rising competitive intensity in the fintech space. Schulman is a chronic underperformer who has destroyed (72%) alpha during his CEO tenures at PYPL and Virgin Mobile USA. His ManagementTrack Rating is well-below average at 3.0 (vs. median rating of 4.9 across Paragon's platform) and he has 18 level "2" or "3" audit, financial, and governance red flags identified including material impairments, Benford's Law, Financial Restatements, and Internal Controls during both of his CEO tenures.
Edition: 143
- 02 September, 2022
Technology
Poor results and weak guidance - this is more about execution than the economy. Instead of 2023 EPS being c.$3.75 (PER 9.6x), EPS is now likely to be $2.00 to $2.25. This (again) brings down the “shut your eyes and buy it” moment from $36 per share to $20. INTC is no longer a value stock as its earnings have evaporated and one must now look through to the recovery. Although this is far from certain as Richard Windsor still has concerns re. the longevity of the x86 processor design and INTC’s financial strength is weakening fast. Qualcomm, MediaTek, and TSMC remain far better places to be in the semiconductor sector at the moment.
Edition: 141
- 05 August, 2022
US Bancorp (USB) & Fifth Third Bancorp (FITB)
Financials
Possible M&A? Paragon’s JetTrack has been flagging some interesting flights between the two banks in recent months - this would be an acquisition that makes sense for USB and their acquisitive C-Suite. While more recent acquisitions have been focused in the Western US, CEO Cecere has stated that he would like to expand into the Southeast (where FITB has a large presence). Adding to the intrigue is the fact that USB flights have also been been tracked to Boston where multiple sizeable holders of both banks' stock are based.
Edition: 141
- 05 August, 2022
Consumer Discretionary
Former colleagues interviewed by Paragon unanimously believe new CEO Amedeo Felisa is a good fit for AML who can lay the foundation for a rebound in its profits and reputation - Felisa was “one of the most important men” in creating Ferrari’s success, developing high-performance cars while generating industry leading margins. He is described as a “tough, honest and demanding leader”, who is “fanatical” about quality. Felisa cares little for corporate hierarchy but readily defers to others on issues outside of his expertise. He “always achieves” financial targets.
Edition: 140
- 22 July, 2022
Technology
As companies adjust to a down economic cycle, topping the list of corporate priorities should be to contain costs / expenses and maintain a healthy FCF. INTC should be no exception. While cutbacks in opex are to be expected, KC Rajkumar believes there is low-hanging fruit in the cost domain for the CFO to rationalise. The option is not without risk, but hard times call for bold measures. KC thinks a viable case can be made for INTC to pull out of TSMC’s 3nm foundry service slated to start in 2023/24.
Edition: 138
- 24 June, 2022
Healthcare
Concerns surrounding the appointment of Jorge Gomez prove justified as the new CEO lasts one day on the job after probe at former company. Last month, Paragon Intel described Gomez as a "Career underperformer" - his career alpha destruction is nearly (-103%) compared to outgoing CFO David Meline who created positive alpha totalling +181% at all three C-Suite positions during his career. Gomez also has a history of concerning audit, financial, and governance red flags, enduring material impairments each year he held a CFO role dating back to 2018. His ManagementTrack rating is very low at just 2.5 vs. Meline's 7.6 and the platform average of 4.9.
Edition: 136
- 27 May, 2022