Investment Thesis
Integer Holdings exhibits weak fundamental profitability with declining earnings despite 8% revenue growth, indicating operational efficiency problems. Free cash flow is virtually non-existent ($737K) despite $24.7M operating cash flow, creating an unsustainable cash generation model that cannot service $1.3B debt from actual cash earnings. Extremely low returns on equity (1.0%) and assets (0.5%) demonstrate the company is destroying shareholder value.
Strengths
- Moderate revenue growth of 8% YoY shows market demand
- Strong liquidity position with 3.75x current ratio and 2.38x quick ratio
- Reasonable leverage at 0.74x debt-to-equity ratio within acceptable range
Risks
- Free cash flow crisis: only $737K generated after capex despite $24.7M operating cash flow, indicating structural profitability failure
- Earnings declining 14% YoY while revenue grows, signaling operational deterioration and margin compression
- Low cash position ($8.1M) relative to $1.3B debt and 2.2x interest coverage leaves minimal cushion for service disruption
- Abysmal returns: 1.0% ROE and 0.5% ROA indicate capital is not efficiently deployed
Key Metrics to Watch
- Free cash flow trend and FCF margin expansion (currently 0.2%)
- Net margin recovery and operating leverage (currently 3.8% and 7.2%)
- Cash balance growth and debt reduction trajectory
Financial Metrics
Revenue
439.6M
Net Income
16.5M
EPS (Diluted)
$0.48
Free Cash Flow
737.0K
Total Assets
3.4B
Cash
8.1M
Profitability Ratios
Gross Margin
24.9%
Operating Margin
7.2%
Net Margin
3.8%
ROE
1.0%
ROA
0.5%
FCF Margin
0.2%
Balance Sheet & Liquidity
Current Ratio
3.75x
Quick Ratio
2.38x
Debt/Equity
0.74x
Debt/Assets
50.3%
Interest Coverage
2.17x
Long-term Debt
1.3B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-06T18:01:04.331146 |
Data as of: 2026-04-03 |
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