VREXVarex Imaging Corporation
Is the business good?
More warning than reassurance: thin cash backing (0.2×) and margins compressing.
Operating profit outpaces operating cash flow, watch accruals and working capital.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is VREX?
Varex Imaging Corporation earns 7.7% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 1.3 points below what the capital costs: growth destroys value
- Operating margin
- 8.3%
Operating margin · Medical Devices median 2.1% · 12 months to Q3 2026
- Cash conversion
- 0.19×
Cash conversion · the operating profit has not turned into cash yet
- Share count, year on year
- +2.6%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2020 | −4.6% |
| FY2021 | 9.1% |
| FY2022 | 10% |
| FY2023 | 8.6% |
| FY2024 | 4.0% |
| FY2025 | −3.3% |
Details›
- Gross margin12 months to Q3 2026
- 34%
- Operating margin12 months to Q3 2026
- 8.3%
- Net margin12 months to Q3 2026
- 2.5%
- Free cash flow margin
- −2.3%
- R&D as % of revenue
- 11%
- Revenue, trailing twelve months
- $865M
- Free cash flow, trailing twelve months
- −$20M
- Net income, trailing twelve months
- $22M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 7.7%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.