One-glance verdict
Undervalued
$75.86 our estimate vs market $22.41
Wall Street consensus: $37.67 (-50.3% lower than our fair-value estimate)
70% below our estimate, below the bear case
Fundamentals snapshot
Tactile Systems Technology, Inc.
TCMD · NGM · Healthcare · Medical Devices
Current price
$22.41
52-week range
$14.44 - $37.77
Market cap
$507.64M
Balance sheet
Healthy
28.21x Strong cushion
Net cash $55.49M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 6.3% last year.
- Reward Returns 11.9% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 9/10 years.
- Risk Insider ownership is only 2.3% (peer median: 6.5%).
What this company does
Tactile Systems Technology, Inc.
Tactile Systems Technology sells medical devices that help people manage chronic conditions like swelling in their limbs and breathing issues. Their main money comes from selling these specialized machines to patients and healthcare providers, and this matters because it shows how well they are reaching people who need their help.
How the company got here
Tactile Systems Technology, Inc. was founded in 1995 with a mission to develop better at-home treatments for chronic conditions. The company's journey began with a focus on lymphedema, a condition causing swelling due to fluid buildup in the lymphatic system. Recognizing the limitations of traditional treatments like bandaging and manual massage, the founders developed the Flexitouch system, a pneumatic compression device designed to mimic therapeutic massage in the home setting. A significant turning point was the company's initial public offering (IPO) in 2016, which provided capital for expansion. In 2021, Tactile Systems further diversified by acquiring the AffloVest business, adding a new line of products for airway clearance to its portfolio.
What it actually does
Tactile Systems Technology, Inc. is a medical technology company that creates and sells devices to help people manage chronic health conditions at home. These aren't over-the-counter gadgets; they are prescription-based medical devices designed to improve patients' quality of life and reduce the burden on healthcare systems. The company focuses on conditions that involve swelling and fluid buildup, as well as respiratory issues, providing solutions that patients can use comfortably and conveniently in their own homes.
Lymphedema and Related Conditions
This is the company's core business, focused on treating lymphedema and similar conditions like phlebolymphedema, lipedema, and chronic venous insufficiency. These conditions cause swelling, often in the limbs, due to issues with the lymphatic system or blood circulation. Tactile Systems offers a range of pneumatic compression devices, such as the Flexitouch Plus, Entre Plus, and Nimbl systems. These devices use controlled air pressure to gently massage the affected areas, helping to move fluid, reduce swelling, and alleviate discomfort. This segment represents the largest portion of the company's revenue.
Airway Clearance Therapy
This business line centers on the AffloVest, a specialized vest designed to help patients with chronic respiratory conditions clear mucus from their airways. Conditions like cystic fibrosis or certain neuromuscular disorders can make it difficult for patients to cough effectively, leading to mucus buildup. The AffloVest uses high-frequency vibrations to loosen and mobilize this mucus, making it easier for patients to expel. This segment, acquired in 2021, represents a smaller but important part of Tactile Systems' overall offerings, expanding its reach into respiratory care.
What management is betting on now
Tactile Systems' current strategy revolves around deepening its presence in the lymphedema market by increasing patient and clinician awareness and improving access to its therapies. They are also focused on growing the airway clearance business, scaling its commercial operations, and enhancing product innovation. A key priority is to improve how patients gain access to these devices through better payer relationships and reimbursement processes, ensuring more people can benefit from their at-home treatment solutions. The company is also investing in technology and clinical evidence to support its products and expand their reach.
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$9.31M
FY2024 Q4
$15.87M
FY2025 Q1
$38.00K
FY2025 Q2
$14.39M
FY2025 Q3
$9.22M
FY2025 Q4
$16.79M
FY2026 Q1
$-1.16M
FY2026 Q2
$1.97M
Revenue
$85.70M
Net income
$7.79M
Diluted EPS
0.34
Operating cash flow
$3.25M
Free cash flow
$1.97M
Fetching…
Sources
Revenue
$75.27M
Net income
$-1.76M
Diluted EPS
-0.08
Operating cash flow
$-339.00K
Free cash flow
$-1.16M
Fetching…
Sources
Revenue
$103.59M
Net income
$10.63M
Diluted EPS
0.45
Operating cash flow
$17.30M
Free cash flow
$16.79M
Fetching…
Sources
Revenue
$85.75M
Net income
$8.21M
Diluted EPS
0.36
Operating cash flow
$10.34M
Free cash flow
$9.22M
Fetching…
Sources
Revenue
$78.91M
Net income
$3.22M
Diluted EPS
0.14
Operating cash flow
$14.76M
Free cash flow
$14.39M
Fetching…
Sources
Revenue
$61.27M
Net income
$-2.97M
Diluted EPS
-0.13
Operating cash flow
$417.00K
Free cash flow
$38.00K
Fetching…
Sources
Revenue
$85.58M
Net income
$9.72M
Diluted EPS
0.40
Operating cash flow
$16.33M
Free cash flow
$15.87M
Fetching…
Sources
Revenue
$73.09M
Net income
$5.16M
Diluted EPS
0.21
Operating cash flow
$10.26M
Free cash flow
$9.31M
Fetching…
Sources
Is it cheap or expensive?
Fair value $75.86 vs current price $22.41
Wall Street consensus is the average analyst price target: $37.67 (-50.3% lower than our fair-value estimate).
Our most-likely fair value is $75.86 a share — about 238.5% above today's price of $22.41, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $55.5M - more cash than debt. Interest coverage 28.2x.
Net debt
$-55.49M
Interest coverage
28.21x
Tactile Systems Technology, Inc.'s profit covers its interest bill about 28.2 times over. which is stronger than most peers shown here and 3 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
TCMD
BASELINE
Tactile Systems Technology, Inc.
Total debt $14.36M Interest coverage 28.21x This is the baseline the peer rows are being compared against.
Total debt $29.09M Interest coverage 371.93x +1,219% vs TCMD Carries about 13.2x more debt cushion than TCMD.
Total debt $20.07M Interest coverage -1.02x -100% vs TCMD This peer has almost no interest-payment cushion compared with TCMD.
Total debt $263.67M Interest coverage -1.54x -100% vs TCMD This peer has almost no interest-payment cushion compared with TCMD.
Total debt $190.25M Interest coverage 13.10x -54% vs TCMD Carries about 2.2x less debt cushion than TCMD.
Total debt $233.42M Interest coverage -9.03x -100% vs TCMD This peer has almost no interest-payment cushion compared with TCMD.
What you should know
The case for and against TCMD
3 Rewards
1 Risk
Rewards
-
Revenue grew 6.3% last year.
-
Returns 11.9% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 9/10 years.
Risks
-
Insider ownership is only 2.3% (peer median: 6.5%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
20.94x
Forward P/E
15.40x
P/B
2.27x
P/S
1.45x
EV/EBITDA
10.83x
PEG ratio
17.79x
Profitability
How much profit each dollar creates
Gross margin
76.8%
Operating margin
8.0%
Net margin
7.1%
ROE
11.9%
ROA
7.9%
Health
Liquidity and balance-sheet strength
Debt / equity
0.06x
Current ratio
4.12x
Quick ratio
3.37x
Total debt
$14.36M
Total cash
$69.85M
Growth
How the business has been compounding
Revenue TTM
$350.31M
Revenue 5Y CAGR
12.2%
EPS TTM
1.07
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$30.55M
Free CF TTM
$40.43M
FCF margin
11.5%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
—