Treace Medical Concepts, Inc. — Earnings Quality Grade F
TMCI · Healthcare
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 72 days, change +1 days YoY
AR growth 3.3% vs revenue growth 1.6%
Revenue 1.6%, CFFO 57.0%. Cash follows revenue
Expense Quality
Inventory -8.2% vs COGS 4.5%. Normal
CapEx growth 16.6% vs revenue 1.6%. Normal
SG&A/Gross Profit = 120.0%, exceeds 70%
Gross margin 79.8%, change -0.6pp. Stable
Cash Flow Quality
CFFO < Net Income for 3 consecutive years
Small-cap context: Small-cap CFFO/NI often diverges from working-capital swings, not necessarily manipulation.
FCF is negative ($-0.0B)
Accruals ratio = -22.6%. Low accruals
Cash $0.0B covers 67% of debt $0.1B
Balance Sheet Health
Goodwill+Intangibles $0.0B = 23% of equity. Manageable
Interest coverage = -10.2x (<2x). Financial stress
Other assets grew 200.0% vs revenue 1.6%
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.
Goodwill+Intangibles change -5% YoY. Normal
Manipulation Score
M-Score = -3.50 (< -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