Neuropace, Inc. — Earnings Quality Grade F
NPCE · Healthcare
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 54 days, change -5 days YoY
AR growth 14.2% vs revenue growth 25.1%
Revenue 25.1%, CFFO 38.7%. Cash follows revenue
Expense Quality
Inventory growth 26.3% far exceeds COGS 9.3%, margin rising. Fraud signal
Small-cap context: Inventory ratios on a small base are noisy; a single product launch can move them sharply.
CapEx growth 8.5% vs revenue 25.1%. Normal
SG&A/Gross Profit = 85.0%, exceeds 70%
Gross margin rose +3.3pp while AR increased and AP decreased. Fraud pattern
Cash Flow Quality
CFFO < Net Income for 3 consecutive years
Small-cap context: Small-cap CFFO/NI often diverges from working-capital swings, not necessarily manipulation.
FCF is negative ($-0.0B)
Accruals ratio = -9.9%. Low accruals
Cash $0.1B covers 86% of debt $0.1B
Balance Sheet Health
No goodwill. Clean balance sheet
Interest coverage = -2.2x (<2x). Financial stress
Other assets grew 71.5% vs revenue 25.1%
No write-off data
Acquisition Risk
FCF after acquisitions negative for 3 years
Small-cap context: A single acquisition on a small balance sheet can trip serial-acquirer logic.
No goodwill
Manipulation Score
M-Score = -3.00 (< -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