TCMDTactile Systems Technology, Inc.
Is the business good?
A genuinely good business: earnings fully cash-backed (1.3×) and margins widening.
Operating profit is fully backed by cash. Conversion is worsening vs a year ago.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
A balanced mix of margins, efficiency, and leverage. ROE 10% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is TCMD?
Tactile Systems Technology, Inc. earns 18% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 9.0 points above what the capital costs: growth creates value
- Operating margin
- 10%
Operating margin · Medical Devices median 2.1% · 12 months to Q2 2026
- Cash conversion
- 1.31×
Cash conversion · 3.03× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −0.77%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | −1.9% |
| FY2021 | −0.85% |
| FY2022 | −5.2% |
| FY2023 | 6.6% |
| FY2024 | 7.6% |
| FY2025 | 8.9% |
Details›
- Gross margin12 months to Q2 2026
- 77%
- Operating margin12 months to Q2 2026
- 10%
- Net margin12 months to Q2 2026
- 7.1%
- Free cash flow margin
- 7.7%
- R&D as % of revenue
- 2.9%
- Revenue, trailing twelve months
- $350M
- Free cash flow, trailing twelve months
- $27M
- Net income, trailing twelve months
- $25M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 18%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.