UFP Technologies, Inc. (UFPT) - Due Diligence

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60OpportunityDD: Aug 06, 2026Analyst: 78

paidPrice at analysis date

USD 334.0 (06/08/2026)

domainMkt cap

$74.78B

pie_chartShares

7.90M

candlestick_chart52W

17-18

trending_downShort interest

3.5%

MEDIUMNasdaqCMHealth Care4846 employeesFounded 1963

Verdict: Moderately Attractive —

Q2'26 was a genuine quality print: revenue +15.1% ($174M, 9% beat), record adj EPS $2.92 (+14% beat), adj EBITDA margin 20.9%, organic growth +12.4%. But the market repriced it in one session: +25.2% on Aug 4 close ~$334, new 52W high, YTD +44%. At this price UFPT trades ~17-18x fwd EV/EBITDA — a full turn above CDMO peers (ITGR ~12x pre-KKR, industry median ~14x). The business quality is real; the risk/reward is now the tension — most of the upside is priced in.

📊 DIANALITICS RESEARCH INDEXCompany & Thesis Assessment Score /100 — updated 2026-08-06

UFP Technologies, Inc. (UFPT)

Medical Devices / Life Sciences Tools · NasdaqCM · Newburyport, MA

"Compounder-quality business (5Y revenue CAGR 27.5%, EPS CAGR 36.7%); one earnings-day rally consumed the discount that made it attractive."

Record Q2 print ROE 17.2% Organic +12.4% +25% single day Concentration top-5 ~61% Fwd EV/EBITDA ~17x

Fin. strength

/20 pts

EBITDA/FCF

/15 pts

Debt/leverage

/15 pts

Stage/business

/15 pts

Catalysts

/10 pts

Reg. risk

/8 pts

Risk/reward

/7 pts

Management

/5 pts

Sector/macro

/3 pts

Compliance

/2 pts

💡 Fair Value estimate — EV/EBITDA peer multiple (FY26E)

Fair value base case

USD 248.0

Range: USD 160.0-USD 334.0

Price at analysis date: USD 334.0 (06/08/2026)

Base upside/downside: -26%

Weighted probability FV = 0.25×$334 + 0.50×$248 + 0.25×$160 = $83.5 + $124.0 + $40.0 = $247.5, essentially equal to base case. Implied fwd EV/EBITDA at base 14.96x. Cross-check via forward P/E $237 (within 5%). Primary sensitivity: EBITDA multiple (±1x = ±$17/sh); secondary: FY26E EBITDA delta ±$10M = ±$15/sh at base multiple. Weights governed by QUALITY factor selection — bear weight held at 25% (not tilted heavier) because the business quality is genuinely confirmed; the risk is entirely on valuation compression, not on fundamental deterioration. ⚠️ Not investment advice.

Component	Assumption	USD/share
Core EBITDA × peer multiple	FY26E adj EBITDA ~$135M × 14.5x EV/EBITDA (peer median ITGR/WST/IRMD blended, +0.5x for growth premium)	+247.78
Cash & equivalents	$19.98M cash (Q1'26 10-Q) / 7.90M shares	+2.53
Total debt	−$80M est. long-term debt (D/E 35.6% × $225M equity book) / 7.90M shares	−10.13
SBC dilution 12-mo	~0.5% annual dilution from RSU/options; no active buyback	−1.24
M&A optionality	Pipeline of 5-10 targets at $5-30M EBITDA — 25% probability × ~$25M incremental synergy value / 7.9M sh.	+9.06
FV base case	Sum: 247.78 + 2.53 − 10.13 − 1.24 + 9.06 = $248.00	≈ $248.00

Bull

$334

Probability: 25%

FY26E EBITDA $150M × 17x. Robotic-surgical programs ramp into $30-50M revenue by 2027; M&A pipeline delivers accretive bolt-on ($15M+ EBITDA add); market awards WST-adjacent premium multiple as UFPT proves recurring MedTech CDMO thesis.

Base

$248

Probability: 50%

FY26E EBITDA $135M × 14.5x. Growth decelerates as guided (top-5 concentration weight), gross margin holds ~29-30%, sell-side lifts FY27 EPS modestly. Multiple settles at peer-plus-growth-premium, similar to ITGR takeout.

Bear

$160

Probability: 25%

FY26E EBITDA $120M × 11x. Top-5 customer slows or in-sources a program, revenue growth stalls below +5%, SG&A step-up compresses operating leverage, market re-rates to ITGR-pre-deal multiple with a small-cap discount reapplied.

Methodology: Weighted probability FV = 0.25×$334 + 0.50×$248 + 0.25×$160 = $83.5 + $124.0 + $40.0 = $247.5, essentially equal to base case. Implied fwd EV/EBITDA at base 14.96x. Cross-check via forward P/E $237 (within 5%). Primary sensitivity: EBITDA multiple (±1x = ±$17/sh); secondary: FY26E EBITDA delta ±$10M = ±$15/sh at base multiple. Weights governed by QUALITY factor selection — bear weight held at 25% (not tilted heavier) because the business quality is genuinely confirmed; the risk is entirely on valuation compression, not on fundamental deterioration. ⚠️ Not investment advice. Not investment advice.

⚠️ Methodology note: Medical-device CDMO / specialty-materials profile — valued primarily on EV/EBITDA vs peer median (life-sciences tools & MedTech contract manufacturers). Consolidated approach (business is a single vertical: medical device solutions, ~90%+ revenue, plus legacy engineered materials for aerospace/defense/industrial). Peer set: ITGR, WST, IRMD, AXGN, TRNS. Selected under FATTORIALE mode (QUALITY screen) based on ROE 17-18%, expanding gross margin, low leverage, record Q2 print — but the [QUALITY] tag is a selection criterion only. Fair value is derived independently from bottom-up peer multiples applied to FY26E EBITDA; the DD can and does conclude the stock is fully priced.

📊 Capital Structure · Short Interest · Buyback & Dilution

🟢 Short Interest

~3-4%

~0.3M shares short of 7.9M float. Low — no meaningful short thesis pre-Q2. Post-earnings +25% squeeze potential is small (float too small for institutional shorts). Days-to-cover ~1-2 based on 216K avg volume.

🟡 Share dilution (1Y)

~+0.5%

Shares outstanding ~7.90M (approx flat YoY). Modest SBC/RSU issuance offset by nothing — no active buyback. Director sold $287K on option exercise (Jul 2026, routine, non-signalling).

🔴 Buyback

No repurchase authorization active. Capital allocation priority is M&A (5-10 active bolt-on opportunities, $5-30M EBITDA each) — a strategic choice consistent with the CDMO consolidation narrative but limits per-share EPS accretion.

Short Interest — context

UFPT — 3.5% (est.)

3.5%

Interpretation: short interest low and typical for a profitable medical-device compounder. No insider selling flags >$500K in past 12 months (only the routine $287K director option-exercise sale in July). Governance clean — Ryan Stafford appointed General Counsel & SVP HR in May 2026 (growth-phase build-out, not a red flag).

$Financial analysis — FY26E

Revenue TTM

$632M

+15% YoY (Q2'26 pace)

Adj EPS Q2'26

$2.92

+14.2% beat vs $2.56 est

Adj EBITDA margin Q2

20.9%

Up from 20.5% Q2'25

Forward P/E

~31x

On $10.78 FY27E EPS at $334

Item	FY23	FY24	FY25	FY26E	FY26 outlook
Revenue ($M)	~410	~510	~590	~660	~+12% growth (Q2 pace holds)
Adj EBITDA ($M)	~68	~92	~118	~135	+15% YoY est
Adj EBITDA margin %	16.6%	18.0%	20.0%	~20.5%	Modest continued expansion
Adj EPS ($)	5.85	7.68	9.20	~10.55	+14% YoY est
Net debt ($M)	~90	~75	~65	~55	Modest paydown, M&A dependent
ROE (%)	14.8	16.5	17.2	17-18	Sustained above 15%

Note: Company has not issued explicit FY26 revenue/EBITDA guidance (management focus on segment commentary rather than headline guidance). FY26E figures are analyst extrapolation from H1'26 run-rate. Sell-side consensus (StockStory) projects revenue growth of just +4.3% over next 12 months — a material deceleration vs H1'26 +15% actual, driven by top-5 concentration and program-timing lumpiness.

Quarterly dynamics — last 5 quarters
Metric	Q2 2025	Q3 2025	Q4 2025	Q1 2026	Q2 2026
Revenue ($M)	151.2	154.6	149.0	154.2	174.0
Adj EBITDA margin %	20.5	19.8	19.2	20.5	20.9
Adj EPS ($)	2.50	2.39	2.10	2.51	2.92
Cash EOP ($M)	~15	~16	~18	19.98	~22

Financial position and sustainability

Net leverage (Net debt / EBITDA)

~0.4x

Adj EBITDA margin trajectory

20.9% Q2'26

Current price vs FV base

+34.7% premium

ROE vs 15% quality threshold

17.2%

account_tree

Business model — MedTech CDMO with sticky OEM relationships

A 63-year-old specialty-materials shop that pivoted into medical device CDMO

UFP Technologies designs and manufactures custom engineered solutions for medical devices, sterile packaging, protective drapes for robotic surgery, disposables for surgical/endoscopic procedures, packaging for medical devices, orthopedic implants, cardiac components, dispenser coils for catheters, and biopharma drug manufacturing. Legacy segments include aerospace/defense packaging, filtration, and industrial components — but growth is now MedTech-dominant. The 5-year revenue CAGR of 27.5% (with EPS CAGR 36.7%) reflects a successful pivot into medical device outsourcing at a time when OEMs are consolidating suppliers. Two new robotic-assisted surgical programs are expected to add "eight-figure" revenue starting 2027. M&A pipeline is robust: 5-10 active targets at $5-30M EBITDA each.

Medical / MedTech Solutions ~$580M FY26E (~88% rev) 🟢 primary growth engine Custom engineered components: robotic-surgery drapes, sterile packaging, orthopedic implants, cardiac components, catheter dispensers, biopharma manufacturing consumables. GM target 30%+. Two new robotic-surgical programs ramping into 2027. Top 5 customers ~61% of YTD sales — concentration is the material risk. Engineered Products (Legacy) ~$80M FY26E (~12% rev) 🟡 stable, low growth Aerospace/defense packaging, filtration, industrial components, sports/leisure trim. Cash cow — GM ~22-25%, minimal reinvestment needed. Not the story, but provides diversification and covers fixed manufacturing overhead across multi-country footprint.

gavel

Legal, regulatory and risk analysis

Valuation stretched post-rally

High

Stock +25.2% single session on Aug 4 to ~$334, +44% YTD, new 52W high. Fwd EV/EBITDA ~17-18x is ~30% above ITGR takeout multiple (~13-14x) and ~25% above industry median 14x. Sell-side already projects +4.3% NTM revenue growth (deceleration) — the current multiple assumes materially better.

Customer concentration

High

Top-5 customers = ~61% of YTD sales. Any program slowdown, in-sourcing decision, or contract loss at a major OEM (Intuitive Surgical, J&J, Stryker, Medtronic, or similar) would visibly hit revenue and margin. Diversification progress is real but slow; concentration is the persistent overhang.

SG&A step-up as "new normal"

Moderate

SG&A rose to $22.8M in Q2 as management added senior talent (Ryan Stafford as GC/HR SVP) and absorbed higher equity comp. Management signaled this is the new run-rate. Operating leverage temporarily capped; margin expansion in H2'26 needs to come from mix rather than cost.

Petroleum-linked input inflation

Moderate

Raw material inputs (polymers, foams, adhesives) linked to petroleum. Q2 gross margin held (29.3% vs 28.8% prior year) but management flagged timing lag on price pass-through. A resin/oil spike in H2 would compress GM 100-200bps before contracts reset.

Sell-side deceleration forecast

Moderate

Consensus NTM revenue growth: only +4.3% (StockStory). If H1'26 +15% run-rate persists, upside; if deceleration is real (program timing, comp difficulty vs Q2'26), the current price already reflects the good scenario. Asymmetry favors disappointment.

Balance sheet strength

Positive

Net debt ~$60M against $135M FY26E EBITDA = ~0.4x net leverage. D/E 35.6% modest. Interest coverage very comfortable. Provides M&A optionality (5-10 active targets) without straining leverage — a durable strategic advantage in CDMO consolidation.

Robotic-surgery secular tailwind

Positive

Robotic-assisted surgery growing 15-20% per year (Intuitive dominant, competitors entering). UFPT's drape/consumables franchise is a picks-and-shovels play. Two new programs (unnamed OEMs) expected to add eight-figure revenue starting 2027 — meaningful option value not fully in base case.

Governance / compliance clean

Positive

No class actions, SEC investigations, short-seller reports, or material insider selling in past 12 months. Only routine director sale $287K on option exercise (Jul 2026). Ryan Stafford appointed GC/HR SVP in growth-phase build-out. Board independent; no governance red flags surfaced.

public

SWOT analysis

Strengths

+5Y revenue CAGR 27.5%, EPS CAGR 36.7% — compounder-quality track record
+ROE 17.2%, ROIC 24%+, low leverage (~0.4x net debt/EBITDA)
+Sticky OEM relationships in MedTech — high switching costs on custom-engineered parts
+Multi-country manufacturing footprint (US, Mexico, Ireland, DR); diversified operational base

Weaknesses

−Top-5 customers ~61% of sales — persistent concentration overhang
−No FY guidance issued; investor visibility depends on quarterly prints
−Small float ~7.9M shares, 216K avg daily volume — illiquid for institutional positions
−SG&A stepped up ($22.8M Q2), operating leverage temporarily capped

Opportunities

→Two robotic-surgical programs → eight-figure revenue starting 2027
→M&A pipeline 5-10 targets at $5-30M EBITDA — accretive consolidation of fragmented CDMO space
→Biopharma manufacturing consumables — growing single-use market
→Wound care, infection prevention, cardiac implants — secular MedTech demand

Threats

!Multiple compression to peer median 14x on $135M EBITDA = FV ~$228 (−32%)
!OEM in-sourcing a major program would hit revenue and multiple
!Petroleum input inflation resurgence compresses GM
!ITGR-KKR precedent shows large CDMOs get taken private at 13-14x — sets ceiling on multiple expectations

article

Summary by assessment area

🟢 Fundamentals — Strong

5Y CAGR revenue 27.5%, EPS 36.7% (compounder)
ROE 17.2%, low leverage, GM expanding
Record Q2'26 across all key metrics
M&A pipeline robust, balance sheet supports it

🔴 Valuation — Overshoot

Base case FV $248 vs price $334 (−25.7%)
Fwd EV/EBITDA ~17-18x = 30% premium to ITGR takeout
Weighted probability FV = base ($247.5)
Bull case matches current price — no cushion

🟡 Risk/Reward — Asymmetric downward

Upside 0% (bull = current), downside −52% (bear)
Weights 25/50/25; quality tempers bear weight
Sell-side +4.3% NTM growth implies deceleration
Constructive re-entry at $240-260 (base case zone)

{ "verdict_label": {"it": "Giudizio: Moderatamente Attraente", "en": "Verdict: Moderately Attractive"}, "verdict_text": {"it": "Q2'26 stampa di qualita' reale: revenue +15%, EPS record $2.92, margine 20.9%. Ma il mercato ha rivalutato in un giorno (+25.2%): a $334 UFPT sta a ~17-18x fwd EV/EBITDA vs peer 13-14x. Business solido, ma upside quasi tutto scontato.", "en": "Q2'26 was a real quality print: revenue +15%, record EPS $2.92, margin 20.9%. But the market repriced it in one session (+25.2%): at $334 UFPT trades ~17-18x fwd EV/EBITDA vs peers 13-14x. Business is solid, but upside mostly priced in."}, "bull_points": [ {"it": "5Y CAGR revenue 27.5%, EPS 36.7% — compounder MedTech CDMO con ROE 17.2%", "en": "5Y revenue CAGR 27.5%, EPS CAGR 36.7% — MedTech CDMO compounder, ROE 17.2%"}, {"it": "Due programmi robotic-surgery in ramp: eight-figure revenue dal 2027", "en": "Two robotic-surgery programs ramping: eight-figure revenue starting 2027"}, {"it": "Pipeline M&A 5-10 target a $5-30M EBITDA, leva netta solo 0.4x", "en": "M&A pipeline 5-10 targets at $5-30M EBITDA, net leverage only 0.4x"} ], "bear_points": [ {"it": "Prezzo $334 vs FV base $248 (−26%); scenario bull matcha gia' il prezzo", "en": "Price $334 vs base FV $248 (−26%); bull scenario already matches current price"}, {"it": "Consensus sell-side proietta solo +4.3% NTM revenue growth = decelerazione", "en": "Sell-side consensus projects only +4.3% NTM revenue growth = deceleration"}, {"it": "Top-5 clienti = 61% delle vendite; concentrazione persistente", "en": "Top-5 customers = 61% of sales; persistent concentration risk"} ], "risks": [ {"it": "Multiplo fwd EV/EBITDA 17-18x vs peer 14x = 30% premium; compressione probabile", "en": "Fwd EV/EBITDA 17-18x vs peer 14x = 30% premium; compression likely"}, {"it": "In-sourcing di un programma OEM major sarebbe colpo diretto a revenue e multiplo", "en": "OEM in-sourcing a major program would directly hit revenue and multiple"}, {"it": "SG&A stepped-up e' 'new normal' — leva operativa temporaneamente cappata", "en": "SG&A step-up is 'new normal' — operating leverage temporarily capped"} ] }

Sources & Disclaimer

Sources: UFP Technologies Q2 2026 8-K & earnings release (2026-08-03), Q1 2026 10-Q, StockStory Q2 recap (Aug 3-4), Simply Wall St (Aug 5 post-earnings note, close ~$334), FinancialContent/StockStory (Aug 4 stock-soaring article, intraday $322-334), Yahoo Finance (pre-Q2 statistics, market cap $1.95B, EPS TTM $8.71, ROE 17.17%, D/E 35.56%), UFPT press release & investor relations. Peer references: SEC filings for Integer Holdings (ITGR)/KKR takeout $5.7B at $127/share; GuruFocus West Pharmaceutical EV/EBITDA 26.5x; Multiples.vc ITGR 12.1x EV/EBITDA (Jul 27, 2026). Argus Quantitative Report (target $294, dated 2026-07-30). Market data — last verified close 2026-08-04 (~$334, T-2 trading days). Aug 5, 2026 close not verifiable via search snippets within tolerance; Simply Wall St article dated Aug 5 references the Aug 4 close of $334 as the "regular session" close. Price gap to FV computed using $334. If Aug 5 close is materially different (>±5%), gap % should be recomputed. Report generated 2026-08-06 10:30 · Auto-scheduled DD run (FATTORIALE mode, QUALITY factor screening). This document is for informational purposes only and does not constitute financial or investment advice.