{ "model": "qwen/qwen3.6-35b-a3b", "started_at": "2026-05-22T21:36:41.418Z", "system_prompt": "You are Analyst, the thesis-judgment stage of an AI trade-ideas pipeline.\n\nScout has already gathered a JSON dossier of scoring_inputs. Your job is to\nSCORE the dossier against the methodology rubric and either draft an idea\n(if score ≥ 60) or skip.\n\nOPTION B (skip) IS THE EXPECTED DEFAULT. The pipeline publishes rarely and\nonly when something clears a high bar. Most dossiers should return\n{ \"skip\": true, \"reason\": \"...\", \"score\": }. Mediocre publishes burn\nDevil's Advocate budget and create credibility risk on the public site.\n\nLOOK AT THE FULL STRUCTURE MENU. Even when Scout says 'no asymmetric long\nopportunity exists' (verdict=range_bound_or_income), there may be a clear\nINCOME structure (covered call against the high; strangle inside an IV-\nelevated band; CSP at a downside-defended strike). Don't reflex-skip just\nbecause long_stock isn't attractive. Read the dossier looking for what\nSHAPE OF TRADE fits, not just whether long is fits.\n\nSCORING RUBRIC (sum to max 100)\n\nA. SMART-MONEY CLUSTER (max 25) — from scoring_inputs.smart_money\n • 10 pts if 3+ distinct insiders with open-market purchases (code P) in\n last 90 days totaling ≥ $500K\n • +3 pts if CEO is among the buyers\n • +3 pts if CFO is among the buyers\n • +2 pts if total purchases > $5M\n • 5 pts for a known concentrated 13F initiation/add (Berkshire, Pershing\n Square, Appaloosa, Greenlight, Scion, Polen, Pabrai, Tepper, etc.)\n • +3 pts if it's in the manager's top-3 positions\n • 2 pts for politician STOCK Act recent buy\n • +1 pt if multiple unrelated members bought within 30 days\n • Penalty: −10 pts if material insider SELLING > BUYING in dollars\n\nB. OPTIONS FLOW / UOA (max 10) — from scoring_inputs.options_flow\n • 4 pts: whale_call_blocks_otm ≥ 2 with flow_directional_bias = bullish\n and flow_strength ∈ {moderate, strong}\n • 3 pts: bullish IV skew (call IV > put IV) consistent with thesis\n • 2 pts: net_dollar_bias_pct > 30 (sustained call-side flow)\n • 1 pt: large OI building at a defended price level\n • Penalty: −5 pts if whale_put_blocks_otm ≥ 2 and bias is bearish\n without a hedging explanation\n\nC. CATALYST (max 25) — from scoring_inputs.catalyst\n • 10 pts: earnings within 90 days AND last 4 quarters' EPS surprise > 0%\n • 8 pts: pending product launch / FDA / contract milestone in horizon\n • 5 pts: recent guidance raise (last 90 days)\n • 5 pts: quantifiable sector tailwind (named hyperscaler capex flowing\n to this name in $)\n Cap at 25 even if components add to more.\n\nD. MISPRICING (max 15) — from scoring_inputs.mispricing\n • 5 pts: forward P/E ≥ 20% below sector median (with non-deteriorating\n earnings)\n • 4 pts: EV/EBITDA ≥ 30% below sector median\n • 4 pts: FCF yield ≥ 7% with stable FCF\n • 5 pts: SOTP gap ≥ 25% (replaces one of the above)\n Cap at 15.\n\nE. QUALITY (max 15) — from scoring_inputs.quality\n • 5 pts: ROIC ≥ 15% (or trending there)\n • 5 pts: gross margin expanding ≥ 3pp YoY\n • 5 pts: net debt / EBITDA ≤ 2x (or net cash)\n\nF. MOMENTUM/TECHNICAL (max 10) — from scoring_inputs.technical\n • 3 pts: above both 50DMA and 200DMA\n • 4 pts: 12-1 month price return positive AND beating sector\n • 2 pts: RSI 14 in 40-65 zone\n • 1 pt: MACD bullish cross in last 30 days\n\nRISK CLASS — choose one based on the dossier's market_cap field:\n \"core\" — market_cap > $5B. Standard methodology sizing.\n \"asymmetric\" — market_cap ≤ $5B (small-cap moonshot). 90%+ of these\n bets lose money or go to zero; the few that work pay\n for the rest. Position sizing is far more conservative\n to fit the variance.\n\nTHRESHOLDS — depend on risk_class\n\n CORE risk_class:\n ≥ 80 Publish, confidence 5, position size cap 4-5%\n 70-79 Publish, confidence 4, position size cap 2.5-3.0%\n 60-69 Publish, confidence 3, position size cap 1.5-2.0%\n 50-59 Skip unless catalyst <30d + insider cluster\n < 50 Skip\n\n ASYMMETRIC risk_class — strict sizing:\n ≥ 80 Publish, confidence 5, position size cap 1.5%\n 70-79 Publish, confidence 4, position size cap 1.0%\n 60-69 Publish, confidence 3, position size cap 0.5%\n < 60 Skip (no exception; small caps need a clear catalyst)\n Structure must be long_stock (options structures are wrong shape for\n moonshots; Compliance enforces this in code).\n\nANTI-SIGNAL GATES (any one of these forces skip regardless of score):\n • Going-concern audit qualification\n • Pending material litigation (DOJ/SEC enforcement, class action with merit)\n • Customer concentration > 30%\n • Convertible/warrant overhang creating dilution > 10% of float\n • Accounting irregularities (restatements, auditor changes)\n • Avg daily volume < $5M (liquidity gate)\n • Pump-and-dump signals (sudden volume + chat-room mentions)\n\nIf scoring_inputs has anti_signals_present non-empty, treat each entry as a\ngate; skip unless you can articulate WHY it doesn't apply to this case.\n\nEDGE CHECK (philosophical, not numeric)\n\nAfter scoring, ask: \"What does this idea say that the market doesn't already\nknow?\" If the answer is generic (it's cheap, AI is a tailwind, technicals\nlook great), the score is misleading — skip even if numerical score is 65.\nReal edge means a specific data point or interpretation the market missed.\n\nSCOUT VERDICT → STRUCTURE GUIDANCE\n\nRead scoring_inputs and Scout's verdict together. The verdict tells you\nWHICH structures Scout thinks are in scope for this name:\n\n verdict='promising' → long_stock | csp (for asymmetric long)\n verdict='range_bound_or_income' → cc | strangle | csp on pullback\n (DON'T default to long_stock — Scout\n already said this isn't an asymmetric\n long. Look at IV elevated → strangle;\n stock at 52w high, fundamentals healthy\n → cc against implicit long; pullback\n thesis with cash → csp)\n verdict='bearish_setup' → naked_call (rarely; respect ceiling)\n\nIf Scout supplied structure_hints[], they're a starting point. You can\noverride with reasoning, but if you go OUTSIDE the verdict's natural set,\nexplain why in thesis_long.\n\nSTRUCTURE SELECTION — full menu:\n\n long_stock — multi-quarter asymmetric thesis, IV not elevated, want\n full upside participation\n csp — bullish, want to own at strike, IV elevated, ann yield ≥15%\n cc — range-bound or mildly bullish, IV elevated, on top of long\n stock leg, if-called return ≥15% ann\n strangle — RANGE-BOUND thesis with elevated IV. Sell OTM call + OTM\n put. Need: comfortable owning at put_strike, no parabolic\n upside expectation. Ann yield ≥12%. Compute and emit\n breakeven_high (call_strike + total_premium) and\n breakeven_low (put_strike - total_premium).\n naked_put — same setup as CSP but using margin. ~2x yield, margin call\n risk. Only for margin-equipped accounts. Note explicitly.\n naked_call — bearish setup with elevated IV. UNCAPPED loss if rally.\n Confidence ceiling 4 (Compliance enforces). Requires\n explicit upside-shock thesis + defense plan in conditions.\n\nMatch the structure to the thesis shape — don't reach for naked options\njust because the premium is fatter. Most candidates are best as long_stock\nor CSP. Strangles only when you have a clear range thesis backed by IV\nand fundamentals.\n\nIF YOU SKIP — output exactly:\n {\n \"skip\": true,\n \"score\": <0-100 composite>,\n \"score_breakdown\": {\n \"smart_money\": <0-25>, \"options_flow\": <0-10>, \"catalyst\": <0-25>,\n \"mispricing\": <0-15>, \"quality\": <0-15>, \"technical\": <0-10>\n },\n \"reason\": \"1-2 sentences why this dossier doesn't support a thesis.\"\n }\n\nIF YOU PROCEED — output a draft idea matching this schema (this is the same\nschema the published site renders from):\n\n{\n \"skip\": false,\n \"score\": <0-100 composite>,\n \"score_breakdown\": {\n \"smart_money\": <0-25>, \"options_flow\": <0-10>, \"catalyst\": <0-25>,\n \"mispricing\": <0-15>, \"quality\": <0-15>, \"technical\": <0-10>\n },\n \"draft\": {\n \"slug\": \"YYYY-MM-DD-symbol-keyphrase\",\n \"symbol\": \"TICKER\",\n \"company\": \"Full name\",\n \"sector\": \"semis-ai-infra\" | \"small-cap-asymmetric\",\n \"risk_class\": \"core\" | \"asymmetric\",\n \"headline\": \"Punchy 1-line — the news angle on the thesis\",\n \"thesis_short\": \"1 sentence — why this trade exists.\",\n \"thesis_long\": [\n \"Opening paragraph framing the setup.\",\n \"## Catalyst\",\n \"Detailed catalyst narrative.\",\n \"## Why the market is mispricing this\",\n \"Edge explanation, citing dossier facts.\",\n \"## Numbers\",\n \"- Bullet 1 with concrete numbers from the dossier\",\n \"- Bullet 2\",\n \"## Risk\",\n \"Honest description of what could go wrong.\"\n ],\n \"structure\": {\n \"type\": \"long_stock\" | \"csp\" | \"cc\" | \"strangle\" | \"naked_put\" | \"naked_call\",\n \"long_stock\": { \"entry_zone_low\": , \"entry_zone_high\": , \"shares_per_unit\": 100 },\n \"csp\": { \"strike\": , \"expiry\": \"YYYY-MM-DD\", \"premium_target\": , \"annualized_yield_pct\": , \"if_assigned_basis\": },\n \"cc\": { \"underlying_basis\": , \"strike\": , \"expiry\": \"YYYY-MM-DD\", \"premium_target\": , \"if_called_return_pct\": },\n \"strangle\": { \"call_strike\": , \"put_strike\": , \"expiry\": \"YYYY-MM-DD\", \"call_premium_target\": , \"put_premium_target\": , \"total_premium_target\": , \"breakeven_high\": , \"breakeven_low\": , \"annualized_yield_pct\": , \"max_loss_note\": \"...\" },\n \"naked_put\": { \"strike\": , \"expiry\": \"YYYY-MM-DD\", \"premium_target\": , \"annualized_yield_pct\": , \"max_loss_per_contract\": , \"margin_estimate_per_contract\": , \"warning\": \"...\" },\n \"naked_call\": { \"strike\": , \"expiry\": \"YYYY-MM-DD\", \"premium_target\": , \"annualized_yield_pct\": , \"max_loss\": \"UNLIMITED\", \"warning\": \"...\" }\n },\n \"entry\": {\n \"price_at_idea\": ,\n \"conditions\": \"How/when to enter — e.g., 'Open starter on pullback to MA50.'\"\n },\n \"exit\": {\n \"target_price\": ,\n \"time_horizon_months\": ,\n \"stop_conditions\": \"Specific signal(s) that trigger a close.\"\n },\n \"risk\": {\n \"bear_case\": \"Honest, specific bear case (not generic 'market could fall').\",\n \"what_breaks_thesis\": \"Specific event/data that invalidates the call.\",\n \"position_size_pct\": <0.5 to 5.0, conviction-weighted>\n },\n \"sources\": [\n { \"label\": \"...\", \"url\": \"...\" }\n ],\n \"confidence\": <1-5, conservative>,\n \"analyst\": \"research-desk\",\n \"scout_model\": \"minimax/minimax-m2.7\",\n \"analyst_model\": \"qwen/qwen3.6-35b-a3b\",\n \"devils_advocate_verdict\": null\n }\n}\n\nONLY ONE STRUCTURE TYPE. Pick long_stock, csp, OR cc and only fill that\nsub-object. Leave the others null/omitted.\n\nALL NUMBERS must be drawn from the dossier or computable from it. Do not\ninvent prices, strikes, premiums.\n\nOUTPUT ONLY VALID JSON. No surrounding prose, no markdown fences.", "user_prompt": "Here is the dossier from Scout. Decide: skip or draft.\n\n\nLESSONS LEARNED: none yet.\n\nDOSSIER:\n{\n \"symbol\": \"MRCY\",\n \"company\": \"Mercury Systems, Inc.\",\n \"investigation_summary\": \"MRCY is a defense electronics technology company (mission-critical embedded processing components, modules, subsystems) trading near its 52-week high ($98.55 vs $103.84 peak), up ~36% over the past year. The underlying business shows genuine improvement — record Q3 FY26 bookings of $348M (+73.7% YoY), backlog growing 17.9% to ~$1.6B, and non-GAAP EPS inflecting sharply from near-zero to $0.27 in Q3 with full-year guidance raised. However, valuation is punishing: forward P/E ~64x and EV/EBITDA ~63.8x vs sector medians of ~20-25x for defense electronics peers. The recent Form 4 cluster that triggered this investigation consists of two director-level SALES (Carvalho sold 7,000 shares at $89.36; Ratner sold 2,000 shares at $92.46) — not purchases. There are no CEO/CFO open-market buys in the 90-day window. Options flow is notably bearish (put/call ratio 7.09 with -40.8% net dollar bias). At current levels, near-overbought technicals (RSI 70.5), rich valuation, and absence of smart-money buying collectively argue for an income/CC strategy rather than a bullish long.\",\n \"verdict\": \"range_bound_or_income\",\n \"confidence_in_data\": 4,\n \"structure_hints\": [\n \"cc\",\n \"csp\",\n \"strangle\"\n ],\n \"business_snapshot\": \"Mercury Systems is a ~$912M (FY25 revenue) defense electronics company that makes mission-critical embedded processing components, modules, and subsystems for aerospace & defense primes and the U.S. government. Its 'Processing Platform' spans RF front-end to human-machine interface — enabling signal processing from chip scale through integrated subsystems deployed in 300+ programs across 35 countries on air, land, sea, space, and cyber platforms. Key customers include Lockheed Martin, Raytheon (RTX), Northrop Grumman, L3Harris, the U.S. Navy, Boeing, and Leonardo. The company reorganized in late 2024 into four business units: Signal Technologies, Processing Technologies, Integrated Processing Solutions, and EMEA. Recent wins include being selected by L3Harris for SDA Tranche 3 Tracking Layer satellite data recorders — expanding across all four tranches of that missile-tracking constellation. The business is improving operationally: gross margins expanded YoY in Q3, adjusted EBITDA grew 46% YoY to $36M, and management expects positive free cash flow generation in the fourth quarter.\",\n \"scoring_inputs\": {\n \"smart_money\": {\n \"insider_open_market_purchases_90d\": [],\n \"insider_open_market_total_usd_90d\": 0,\n \"distinct_insider_buyers_90d\": 0,\n \"ceo_buy_present\": false,\n \"cfo_buy_present\": false,\n \"material_insider_selling_90d_usd\": 826000,\n \"notable_13f_holders\": [\n \"pending — v2\"\n ],\n \"politician_recent_buys\": [\n \"pending — v2\"\n ]\n },\n \"catalyst\": {\n \"next_earnings_date\": \"2026-08-05\",\n \"recent_eps_surprise_pattern\": \"4 consecutive positive EPS surprises: +109% Q4 FY25, +198% Q1 FY26, +148% Q2 FY26, +290% Q3 FY26 — each massively exceeding estimates. Pattern is strongly bullish on execution.\",\n \"guidance_raise_in_last_90d\": true,\n \"named_catalysts\": [\n {\n \"type\": \"earnings\",\n \"description\": \"Q4 FY26 earnings expected ~August 2026; management guided to full-year FY26 adjusted EPS of $1.07 (vs prior near-zero), with positive free cash flow expected in Q4\",\n \"date_or_window\": \"August 2026\",\n \"source_urls\": [\n \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000021/mrcy-20260505.htm\"\n ],\n \"directional_bias\": \"bullish\"\n },\n {\n \"type\": \"product\",\n \"description\": \"SDA Tranche 3 Tracking Layer award via L3Harris for radiation-tolerant solid-state data recorders; MRCY now on all four tranches of missile-tracking constellation — major design win validation\",\n \"date_or_window\": \"April 2026\",\n \"source_urls\": [\n \"https://finance.yahoo.com/markets/stocks/articles/why-mercury-systems-mrcy-8-011126916.html\"\n ],\n \"directional_bias\": \"bullish\"\n },\n {\n \"type\": \"guidance\",\n \"description\": \"Full-year FY26 guidance raised after Q3 beat; record bookings $348M with 1.48x book-to-bill; domestic business grew 17% YoY organically\",\n \"date_or_window\": \"May 2026\",\n \"source_urls\": [\n \"https://finance.yahoo.com/markets/stocks/articles/mercury-systems-reports-third-quarter-200100186.html\"\n ],\n \"directional_bias\": \"bullish\"\n }\n ]\n },\n \"mispricing\": {\n \"forward_pe\": 64.3,\n \"sector_median_forward_pe\": 22,\n \"ev_to_ebitda\": 63.8,\n \"sector_median_ev_to_ebitda\": 20,\n \"fcf_yield_pct\": 1.6,\n \"sotp_gap_pct\": null,\n \"narrative\": \"MRCY trades at 64x forward P/E vs defense electronics peers at ~20-25x — a significant premium that would require either sustained above-consensus growth or multiple compression to justify. However, the company is inflecting from GAAP-unprofitable ($37.9M net loss in FY24) toward profitability ($1.07 adjusted EPS guided for FY26), which partially supports the valuation if execution continues. The FCF yield of ~1.6% is low but positive for first time — the market may be pricing in continued margin expansion.\"\n },\n \"quality\": {\n \"roic_pct\": null,\n \"gross_margin_trend_pp_yoy\": 3.5,\n \"net_debt_to_ebitda\": 4.95,\n \"balance_sheet_grade\": \"B\"\n },\n \"technical\": {\n \"above_50dma\": true,\n \"above_200dma\": true,\n \"rsi_14\": 70.5,\n \"macd_recent_bullish_cross\": true,\n \"12_1_momentum_vs_sector_pct\": null\n }\n },\n \"price_context\": {\n \"last_close\": 98.55,\n \"ytd_return_pct\": 36,\n \"from_52w_high_pct\": -5.1\n },\n \"filings_reviewed\": [\n {\n \"form\": \"10-K\",\n \"filed\": \"2025-08-11\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952125000024/mrcy-20250627.htm\",\n \"key_takeaways\": [\n \"FY25 revenue $912M (+9.2% YoY); FY24 revenue $835M; FY23: $828M — steady growth but slow for a tech name at this valuation\",\n \"FY25 GAAP net loss $(37.9)M vs FY24 net loss $(137.6)M — substantial improvement but still unprofitable on GAAP basis\",\n \"FY25 adjusted EBITDA $119.4M with margins expanding; significant step-up from $9.4M in FY24\",\n \"Multiple restructuring charges and workforce reductions across FY23-FY25 totaling ~$15-20M+ cumulatively, suggesting operational execution challenges\",\n \"Top 5 customers represent majority of revenue (Raytheon >10%, Lockheed Martin material) — concentration risk is real\",\n \"R&D spend: $67.6M FY25 vs $101.3M FY24 and $108.8M FY23 — R&D declining as % of revenue, which could be positive or negative for a tech company\",\n \"DoD microelectronics budget requests: $2.5-3.3B annually — supports demand thesis\",\n \"Goodwill: $942M against total assets ~$2.4B; large acquisition history with potential impairment risk if margins disappoint\"\n ]\n },\n {\n \"form\": \"10-Q\",\n \"filed\": \"2026-05-05\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000024/mrcy-20260327.htm\",\n \"key_takeaways\": [\n \"Q3 FY26 (March quarter): Revenue $235.8M (+11.5% organic YoY), GAAP net loss $(2.9)M vs $(19.2)M year ago — major improvement\",\n \"Non-GAAP adjusted EBITDA: ~$36M, +46% YoY; margin expanding significantly as backlog converts to revenue\",\n \"Record Q3 bookings $348M with 1.48x book-to-bill ratio — demand environment is robust\",\n \"Backlog at record ~$1.6B (+17.9% YoY); domestic business grew 17% organically — strong demand signals throughout portfolio\",\n \"Gross margin: 29.3% (Q3 FY26) vs 27.0% (Q3 FY25) — 230bp improvement demonstrates operating leverage as volume scales\",\n \"SG&A declining in absolute dollars while revenue grows, confirming cost efficiency program is working\",\n \"Inventory $361.7M vs $332.9M at year-end; work-in-process up significantly ($146M vs $118M) suggesting production ramp underway\",\n \"Operating cash flow positive ~$60M YTD through Q3 — on track for full-year FCF positive per management guidance\",\n \"Restructuring charges of $5.6M YTD from workforce reductions (~100 positions eliminated); cost discipline improving\"\n ]\n },\n {\n \"form\": \"8-K\",\n \"filed\": \"2026-05-05\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000021/mrcy-20260505.htm\",\n \"key_takeaways\": [\n \"Q3 FY26 press release confirming record bookings, backlog growth, and guidance raise to full-year $1.075 adjusted EPS\"\n ]\n }\n ],\n \"options_context\": {\n \"expiries_examined\": [\n \"2026-07-17\"\n ],\n \"iv_summary\": \"ATM IV at Jul 17 expiry is ~52-54% — elevated vs typical defense electronics names; reflects recent earnings volatility and near-term binary risk around August Q4 print\",\n \"notable_skew_or_flow\": \"Put/call ratio of 7.09 with net dollar bias -40.8% (strongly bearish). Top put OI at $80 strike (351 contracts) suggests hedging activity concentrated below spot ~$98.55 — not aggressive bull positioning. Call OI dominated by $100 strike (395 contracts, ITM equivalent since spot near $99) indicates covered call writing likely from institutional holders. The combination of high put/call ratio + massive $100 call OI is consistent with income/CC strategy being the dominant options flow.\"\n },\n \"competitive_landscape\": \"Tier 2 defense electronics supplier competing in embedded processing (C4I, sensor/EW, radar). Main competitors: Curtiss-Wright (embedded computing modules), Ametek (sensors/mission systems), Teledyne (imaging/sensors), and a fragmented set of smaller players. MRCY differentiates through its open-standards MOSA architecture, trusted domestic microelectronics fabrication, and breadth from components to full subsystems. The defense electronics Tier 2 market is ~$51B growing at 6-7% CAGR — MRCY's $912M revenue suggests <2% share with significant whitespace for growth via outsourcing trends. DoD push for open systems architectures benefits companies like MRCY that can offer modular, standards-based solutions vs proprietary prime-integrator designs.\",\n \"key_risks\": [\n \"GAAP unprofitability (still losing money on reported basis) — market is paying 64x forward EPS for a company with historically inconsistent earnings\",\n \"Customer concentration: Raytheon >10% of revenue; top 5 customers represent majority of sales — program cancellations or delays would be material\",\n \"High leverage: Net debt/EBITDA ~4.95x with $591M long-term debt vs improving but still thin EBITDA coverage in a cyclical business\",\n \"Goodwill of $942M (38% of assets) from acquisition-heavy strategy; impairment risk if integration synergies don't materialize\",\n \"Very high valuation relative to defense sector peers — any guidance miss could cause significant multiple compression\",\n \"Insider selling pattern: no CEO/CFO open-market buys in 90 days; two director-level sales are the trigger for this investigation, not insider conviction buying\",\n \"Defense budget risk: DoD spending levels subject to political appropriations process; any sequestration or defense cuts disproportionately affect Tier 2 suppliers like MRCY\",\n \"Long operating cycle with percentage-of-completion accounting creates earnings volatility from estimate changes — $9.6M adverse revenue impact in Q3 alone from changes in estimates\"\n ],\n \"what_the_market_might_be_missing\": \"The SDA Tranche 3 Tracking Layer win expanding across all four tranches of a missile-tracking satellite constellation is more significant than the headline implies. MRCY's data recorder selection by L3Harris for space-based applications (radiation-tolerant solid-state storage) validates both its technical differentiation and its ability to move up the value chain from component supplier to strategic subsystem partner on high-priority DoD programs. This could be the leading edge of a broader content expansion across missile defense, ISR, and space programs — all priority investment areas in current geopolitical environment. If this translates into more sole-source or directed-source positions (which MRCY notes is already happening), margins should expand further than currently modeled.\",\n \"anti_signals_present\": [\n \"dilution\",\n \"accounting\"\n ],\n \"sources\": [\n {\n \"label\": \"10-K FY25 Annual Report\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952125000024/mrcy-20250627.htm\"\n },\n {\n \"label\": \"10-Q Q3 FY26 (March 2026)\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000024/mrcy-20260327.htm\"\n },\n {\n \"label\": \"8-K Q3 Earnings Release May 5, 2026\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000021/mrcy-20260505.htm\"\n },\n {\n \"label\": \"Form 4 - Carvalho (Director) sale May 12 2026\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000028/xslF345X06/form4.xml\"\n },\n {\n \"label\": \"Form 4 - Ratner (EVP CHRO) sale May 11 2026\",\n \"url\": \"https://www.sec.gov/Archives/edgar/data/1049521/000104952126000026/xslF345X06/form4.xml\"\n },\n {\n \"label\": \"SDA Tranche 3 award coverage\",\n \"url\": \"https://finance.yahoo.com/markets/stocks/articles/why-mercury-systems-mrcy-8-011126916.html\"\n }\n ],\n \"unfetched_signals\": [\n \"13f_deltas\",\n \"politician_trades\",\n \"sentiment_score\"\n ]\n}\n\nOutput ONLY the decision JSON described in the system prompt. Do NOT\ninclude ... reasoning blocks — they eat the output token\nbudget and produce truncated, unparseable decisions.", "completions": [ { "ts": "2026-05-22T21:37:11.960Z", "raw_content": "The dossier is for MRCY (Mercury Systems, Inc.).\nScoring inputs:\nA. Smart-Money Cluster: 0 pts. No insider purchases. Material insider selling $826K. -10 pts penalty? Wait, scoring says \"Penalty: −10 pts if material insider SELLING > BUYING in dollars\". I'll give 0 for base, then apply penalty or just give 0. Let's give 0. Actually, the rubric says max 25. I'll just score it 0.\nB. Options Flow / UOA: 0 pts. Put/call ratio 7.09, net dollar bias -40.8% (bearish). Penalty: -5 pts if whale_put_blocks_otm >= 2 and bias bearish without hedging. I'll give 0.\nC. Catalyst: Earnings within 90 days? Next earnings date is 2026-08-05. Current date in dossier context seems to be around May 2026 (Q3 FY26 reported May 5, 2026). So earnings is ~2.5 months away. Last 4 quarters' EPS surprise > 0%: Yes, +109%, +198%, +148%, +290%. That's 10 pts. Guidance raise in last 90d: Yes, +5 pts. Total: 15 pts. Cap at 25.\nD. Mispricing: Forward P/E 64.3 vs sector median 22. Not cheap. EV/EBITDA 63.8 vs 20. Not cheap. FCF yield 1.6%. SOTP null. 0 pts.\nE. Quality: ROIC null. Gross margin expanding 3.5pp YoY. +5 pts. Net debt/EBITDA 4.95 (>2x). 0 pts. Total: 5 pts.\nF. Momentum/Technical: Above 50DMA and 200DMA: +3 pts. RSI 70.5 (not 40-65). MACD bullish cross: +1 pt. Total: 4 pts.\n\nTotal Score: 0 + 0 + 15 + 0 + 5 + 4 = 24.\nWait, let's re-evaluate Catalyst. Earnings within 90 days + last 4 quarters EPS surprise > 0% = 10 pts. Guidance raise = 5 pts. Total 15.\nScore is low. Also, anti_signals_present: [\"dilution\", \"accounting\"]. This triggers the anti-signal gate. \"If scoring_inputs has anti_signals_present non-empty, treat each entry as a gate; skip unless you can articulate WHY it doesn't apply to this case.\" I will skip.\nAlso, the dossier says \"verdict: range_bound_or_income\", but options flow is bearish, valuation is rich (64x Fwd PE), insider selling > buying.\nI will skip.\n\nLet's calculate score carefully:\nA: 0 (insider selling penalty applies, but max is 25, so 0 is fine. I'll note 0)\nB: 0\nC: 15\nD: 0\nE: 5\nF: 4\nTotal: 24.\n\nAnti-signal gate: dilution, accounting. I will skip due to anti-signal gates and low score.\nReason: Rich valuation (64x Fwd P/E), bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting irregularities further justify skipping.\n\nCheck thresholds: ASYMMETRIC? Market cap ~$912M revenue, but market cap isn't explicitly given, but description says \"~$912M (FY25 revenue)\". Usually market cap is higher, but let's assume it's small-cap or core. Score < 50 anyway.\nI will output skip.\nStructure:\n{\n \"skip\": true,\n \"score\": 24,\n \"score_breakdown\": {\n \"smart_money\": 0,\n \"options_flow\": 0,\n \"catalyst\": 15,\n \"mispricing\": 0,\n \"quality\": 5,\n \"technical\": 4\n },\n \"reason\": \"Rich valuation (64x Fwd P/E vs 22x sector), bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting further justify skipping.\"\n}\nWait, let's verify catalyst scoring: \"10 pts: earnings within 90 days AND last 4 quarters' EPS surprise > 0%\". Yes. \"5 pts: recent guidance raise\". Yes. Total 15.\nQuality: \"5 pts: gross margin expanding ≥ 3pp YoY\". Yes, 3.5pp.\nTechnical: \"3 pts: above both 50DMA and 200DMA\". Yes. \"1 pt: MACD bullish cross\". Yes. Total 4.\nScore = 24.\nMatches skip criteria.\nI will produce the JSON.\nOne minor thing: anti-signal gates say \"dilution\" and \"accounting\". I should mention them.\nAll good.\nOutput matches requested format.\nProceed. \nLet's double check the exact scoring rubric for A: \"Penalty: −10 pts if material insider SELLING > BUYING in dollars\". Since base is 0, penalty makes it negative, but I'll cap at 0 for breakdown.\nScore breakdown sums to 24.\nReady. \nOutput matches exactly.✅\nI will generate the JSON. \nSelf-Correction/Refinement during thought: \nCheck if I should give any points for smart money? The rubric says max 25. I'll put 0.\nCheck catalyst: 15.\nCheck quality: 5.\nCheck technical: 4.\nTotal: 24.\nReason is solid.\nProceeds. \nOutput matches schema.\nDone. \nGenerating. \n```json\n{\n \"skip\": true,\n \"score\": 24,\n \"score_breakdown\": {\n \"smart_money\": 0,\n \"options_flow\": 0,\n \"catalyst\": 15,\n \"mispricing\": 0,\n \"quality\": 5,\n \"technical\": 4\n },\n \"reason\": \"Rich valuation (64x Fwd P/E vs ~22x sector median), deeply bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting irregularities further justify skipping.\"\n}\n```\nWait, the prompt says \"ONLY ONE STRUCTURE TYPE. Pick long_stock, csp, OR cc and only fill that sub-object.\" but this is a skip, so I just output the skip object.\nThe skip object format is exactly as specified.\nAll good. \nProceeds. \nOutput matches. \n[Done] \n(Self-Correction/Verification during generation prep)\nLet's verify the exact wording for the skip output:\n{\n \"skip\": true,\n \"score\": <0-100 composite>,\n \"score_breakdown\": {\n \"smart_money\": <0-25>, \"options_flow\": <0-10>, \"catalyst\": <0-25>,\n \"mispricing\": <0-15>, \"quality\": <0-15>, \"technical\": <0-10>\n },\n \"reason\": \"1-2 sentences why this dossier doesn't support a thesis.\"\n}\nMatches perfectly.\nScore is 24.\nReady. \nOutput matches. \nProceeds. \n[Final Check of the Prompt]\n\"OUTPUT ONLY VALID JSON. No surrounding prose, no markdown fences.\"\nI will output raw JSON.\nDone. \n[Output Generation] -> *Proceeds*\n\n\n{\n \"skip\": true,\n \"score\": 24,\n \"score_breakdown\": {\n \"smart_money\": 0,\n \"options_flow\": 0,\n \"catalyst\": 15,\n \"mispricing\": 0,\n \"quality\": 5,\n \"technical\": 4\n },\n \"reason\": \"Rich valuation (64x Fwd P/E vs ~22x sector median), deeply bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting irregularities further justify skipping.\"\n}", "cleaned_content": "{\n \"skip\": true,\n \"score\": 24,\n \"score_breakdown\": {\n \"smart_money\": 0,\n \"options_flow\": 0,\n \"catalyst\": 15,\n \"mispricing\": 0,\n \"quality\": 5,\n \"technical\": 4\n },\n \"reason\": \"Rich valuation (64x Fwd P/E vs ~22x sector median), deeply bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting irregularities further justify skipping.\"\n}", "tool_calls": null, "finish_reason": "stop" } ], "tool_results": [], "final_message": "{\n \"skip\": true,\n \"score\": 24,\n \"score_breakdown\": {\n \"smart_money\": 0,\n \"options_flow\": 0,\n \"catalyst\": 15,\n \"mispricing\": 0,\n \"quality\": 5,\n \"technical\": 4\n },\n \"reason\": \"Rich valuation (64x Fwd P/E vs ~22x sector median), deeply bearish options flow (-40.8% net dollar bias), and material insider selling outweigh the positive EPS surprise pattern. Anti-signal gates for dilution and accounting irregularities further justify skipping.\"\n}", "tool_calls_total": 0, "walltime_ms": 30542, "stop_reason": "stop", "completed_at": "2026-05-22T21:37:11.960Z" }