Avanos Medical, Inc. — Earnings Quality Grade F
AVNS · Healthcare
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 54 days, change -14 days YoY
AR growth -18.9% vs revenue growth 1.9%
Revenue 1.9%, CFFO -25.8%. Cash follows revenue
Expense Quality
Inventory 6.6% vs COGS 13.3%. Normal
CapEx growth 77.5% is >2x revenue growth 1.9%
SG&A/Gross Profit = 89.2%, exceeds 70%
Gross margin 50.5%, change -5.0pp. Stable
Cash Flow Quality
CFFO < Net Income for 3 consecutive years
Small-cap context: Small-cap CFFO/NI often diverges from working-capital swings, not necessarily manipulation.
FCF $0.0B, FCF/NI = -0.59
Accruals ratio = -13.7%. Low accruals
Cash $0.1B covers 70% of debt $0.1B
Balance Sheet Health
Goodwill+Intangibles $0.5B = 66% of equity. Over 50%
Interest coverage = 2.0x (<2x). Financial stress
Other assets grew 35.8% vs revenue 1.9%
No write-off data
Acquisition Risk
FCF after acquisitions positive
Goodwill+Intangibles change -10% YoY. Normal
Manipulation Score
M-Score = -3.20 (< -2.22). Unlikely manipulator
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25