Orthofix Medical Inc.

Where It Passes

Where It Falls Short

• Valuation0% pass✓ 7✗ 21▾

  No clean pass — all 13 investors flag at least one valuation criterion

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Book Ratio0.6x

  ✓Graham<= 1.5x

  P/E x P/B

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value-4.8%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=-4.8%, ROC=-6.0%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)8.6x

  ✗Dreman< 8x

  Price / Book Value per Share0.6x

  ✓Dreman< 1.2x✓Templeton< 1.5x✓SchlossP/B <= 0.80x (app cutoff)

  Valuation ReasonablenessOE Yield=-17.2%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldFCF Yield=-0.4%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/B=0.6x

  ✓MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic ValueN/A (negative normalized EPS)

  ✗Marks>= 20% below intrinsic value

  Price / FCF per ShareN/A (negative FCF)

  ✗Ackman<= 25

  Price vs. Trailing Low100% of trailing low ($7.17)

  ✓Templeton<= 120% of trailing low (certified split-adjusted live window)

  Net income / market capitalization-15.40%; #4396/6340 (top 69.3%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+1.4699; #944/6449 (top 14.6%)

  ✓AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share1.58x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change

  ✗SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+2.8586; #839/5247 (top 16.0%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization-15.21%; #3408/4519 (top 75.4%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date-39.03%; #4770/6202 (top 76.9%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Profitability6% pass✓ 7✗ 28▾

  15 of 16 flag OFIX's profitability — Graham, Buffett, Lynch +12 more

  Positive EPS (10 years)7/24 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)12/24 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)-17.6%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)-9.9% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$-49.5M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE-10.5%

  ✗Lynch> 15%

  EBIT / Enterprise Value-4.8%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=-4.8%, ROC=-6.0%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets-10.84%

  ✗PiotroskiROA > 0

  ROA Change YoY-14.10% -> -10.84% (delta: +3.27%)

  ✓PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=3.92%, ROA=-10.84%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY68.3% -> 68.8%

  ✓PiotroskiImproved YoY

  Pre-Tax Income / Revenue-5.2%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity-10.5%

  ✗Dreman> 12%

  Margin of SafetyP/B=0.6x

  ✓PabraiP/B < 1.5 or P/E < 15

  Return on Equity-23.6% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic ValueN/A (negative normalized EPS)

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency12/23 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue-2.5%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity-10.5%

  ✗Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend-18.6% (2023) -> -9.9% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendgross margin 65.1% -> 68.8%, operating margin -18.6% -> -9.9%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Net income / market capitalization-15.40%; #4396/6340 (top 69.3%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets+69.19%; #350/3702 (top 9.5%)

  ✓AsnessTop 30% of eligible cross-section

  Net income / positive book equity-10.48%; #3427/5226 (top 65.6%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0428; #2371/5884 (top 40.3%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-6.5% over 4 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years4/10 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Growth13% pass✓ 3✗ 10▾

  7 of 8 flag OFIX's growth — Graham, Lynch, Dreman +4 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 9.4% vs Rev: 2.1%

  ✗LynchInventory growth < Revenue growth

  EPS Growth Direction

  ✗DremanPositive over recent years

  EPS CAGR-19.5% CAGR over 11 years

  ✗Dreman> 5% annualized

  Positive Net Income Frequency12/23 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth7.1%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendgross margin 65.1% -> 68.8%, operating margin -18.6% -> -9.9%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR15.1%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-6.5% over 4 years

  ✗Neff7%-20% annualized
• Verdicts20% pass✓ 3✗ 12▾

  Split decision: 11 FAIL · 3 PASS · 2 NEUTRAL

  Overall verdict

  ✓GrahamPASS (4/9)✗BuffettFAIL (0/9)✗LynchFAIL (0/7)✗GreenblattRank #2019✓PiotroskiPASS (F-Score 5)✗DremanFAIL (3/11)✗MungerFAIL (0/4)✗PabraiFAIL (1/3)✗AkreFAIL (1/6)✗MarksFAIL (3/5)✗AckmanFAIL (3/9)•TempletonNEUTRAL (5/8)✓SleepPASS (3/6)✗AsnessFAIL (Rank #1407/2370 (Top 59.4%))✗NeffFAIL (1/6)✗SchlossFAIL (3/7)•OshaughnessyNEUTRAL (Not ranked)
• Efficiency25% pass✓ 3✗ 8▾

  6 of 8 flag OFIX's efficiency — Buffett, Greenblatt, Piotroski +3 more

  Current Ratio3.11

  ✓Graham>= 2.0

  ROIC (3-5 yr avg)-9.3%

  ✗Buffett> 10%

  ROIC - WACC-19.3%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)-6.0%

  ✗Greenblatt> 25%

  Current Ratio Change YoY2.57 -> 2.45

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.89x -> 0.97x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities3.11

  ✓Dreman> 1.5

  Return on Invested Capital-2.5%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=-15.9%; FY2024: ROIC=-10.1%; FY2025: ROIC=-10.6%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROICN/A (non-positive net income)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)0/5 years above 12% (latest -10.6%)

  ✗SleepROIC > 12% in a majority of years
• Cash Flow30% pass✓ 4✗ 8▾

  7 of 10 flag OFIX's cash flow — Buffett, Lynch, Dreman +4 more

  Free Cash Flow Proxy$-49.5M

  ✗BuffettPositive and growing

  FCF Positive and Growing$-1.3M

  ✗LynchPositive and growing

  Operating Cash Flow$33.3M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=3.92%, ROA=-10.84%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)8.6x

  ✗Dreman< 8x

  P/E or FCF YieldFCF Yield=-0.4%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive12/17 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap-15.4%

  ✗Ackman>= 4%

  Price / FCF per ShareN/A (negative FCF)

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency19/21 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$-44.5M

  ✗Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization-15.21%; #3408/4519 (top 75.4%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Debt & Leverage42% pass✓ 7✗ 8▾

  7 of 12 flag OFIX's debt & leverage — Buffett, Lynch, Piotroski +4 more

  LT Debt vs Net Current AssetsLT Debt $221.8M vs NCA $292.4M

  ✓GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.35, IC: -4.7x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.52

  ✗Lynch< 0.33

  Cash - Long-term Debt$-135.5M

  ✗LynchPositive preferred

  LT Debt / Total Assets Change17.58% -> 18.50%

  ✗PiotroskiDecreased YoY

  Current Assets / Current Liabilities3.11

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.52

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Debt Levels0.52

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=-4.7x, D/EBITDA=N/A

  ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.52

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.5168; #2497/4210 (top 59.3%)

  ✗AsnessTop 30% of eligible cross-section