Merit Medical Systems Inc. Common Stock (MMSI)

FairStock Score: 54/100 — MIXED

Key Financials

Strengths

• Generates $180 million in annual free cash flow (4.4% yield on market cap)
• Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics

Concerns

• Trades significantly above Graham Number ($36) with negative 93% margin of safety—limited downside protection

AI Analysis

Merit Medical Systems Inc. Common Stock is a small-cap healthcare company valued at $4.1 billion. The business generates $1.5 billion in annual revenue with a 2.5% net margin and $180 million in free cash flow. From a quality standpoint, Merit shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and healthy Altman Z-Score of 3.2. On valuation, the stock is trading at a premium 32.2x earnings, with trades above its Graham Number with a negative 93% margin. Growth dynamics show revenue growing at 10.9% and profit growth of 36.0%. Our composite FairStock Score of 54/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $180 million in annual free cash flow (4.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 32x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer