UFPT Stock Study (3-6-26)
Posted by Mark on September 8, 2025 at 06:55 | Last modified: March 6, 2026 09:18I recently did a stock study on UFP Technologies Inc. (UFPT, $201.36).
M* writes:
> UFP Technologies Inc is a contract development and manufacturing
> organization that specializes in single-use and single-patient
> medical devices. The company manufactures its products by
> converting raw materials using laminating, molding, radio
> frequency, and impulse welding, and fabricating manufacturing
> techniques. It is an important link in the medical device supply
> chain and a valued outsource partner to many of the top medical
> device manufacturers in the world. The company’s single-use and
> single-patient devices and components are used in a wide range of
> medical devices, disposable wound care products, infection
> prevention, minimally invasive surgery, wearables, orthopedic
> soft goods, and orthopedic implant packaging.
Over the past decade, this small-size company grows sales and EPS at annualized rates of 17.7% and 26.7%, respectively. Lines are mostly up, straight, and parallel except for sales+EPS decline in ’20. Five- (10-) year EPS R^2 is 0.81 (0.89) and Value Line (VL) gives an Earnings Predictability score of 60. Shares outstanding increase 6.8% (0.7%/year).
Over the past decade, PTPM leads peer averages but trails the industry despite increasing from 8.4% to 13.7% (’25) with a last-5-year mean of 13.4%. ROE leads peer averages and is even with the industry while increasing from 7.1% to 16.7% (’25) with a last-5-year mean of 15.5%. Debt-to-Capital is less than peer and industry averages despite increasing from 0.8% to 26.7% (’25) with a last-5-year mean of 26.1%.
Quick Ratio is 1.4 and Interest Coverage 9.4 per M* who assigns “Narrow” [quantitative] Economic Moat and a B grade for Financial Health (BetterInvesting® website). VL rates the company B+ for Financial Strength.
With regard to sales growth:
- YF gives YOY ACE 6.0% and 5.7% for ’26 and ’27 (based on 4 analysts).
- Zacks gives YOY ACE 6.5% and 5.7% for ’26 and ’27, respectively (3 analysts).
- CFRA gives ACE 6.2% YOY and 5.9% per year for ’26 and ’25-’27, respectively (4).
I am forecasting below the range at 4.0% per year.
With regard to EPS growth:
- MarketWatch projects 10.5% YOY and 11.4% per year for ’26 and ’25-’27, respectively (based on 4 analysts).
- Nasdaq.com gives ACE 11.6% YOY for ’27 (3 analysts).
- YF gives YOY ACE 4.9% and 11.8% for ’26 and ’27, respectively (4).
- Zacks gives YOY ACE 4.5% and 11.6% for ’26 and ’27, respectively (3).
- VL gives ACE 14.3% annualized from 2024 to 2026 / 2027 (3).
- CFRA gives ACE 17.0% YOY and 14.4% per year for ’26 and ’25-’27, respectively (4).
Analyst estimates are scant with VL providing the longest-term estimate at only 2.5 years out. My 7.0% forecast is near bottom of the short- and longer-term range. Initial value is ’25 EPS of $8.75/share.
My Forecast High P/E is 26.0. Over the past 10 years, high P/E increases from 25.0 to 33.1 (’25) with a last-5-year mean of 35.2 and last-5-year-mean average P/E of 26.6. I am below the range.
My Forecast Low P/E is 13.0. Over the past 10 years, low P/E ranges from 10.3 in ’22 to 21.1 in ’21 with a last-5-year mean of 17.9. I am forecasting near bottom of the range [only ’22 and ’19 (10.6) are less].
My Low Stock Price Forecast (LSPF) is $140.00. Default ($114.10) given initial value from above seems unreasonably low at 43.3% less than previous close and 36.0% less than 52-week low. My [arbitrary] selection is 30.5% and 21.5% less, respectively (and results in an effective Forecast Low P/E of 16.0).
These inputs land UFPT in the HOLD zone with a U/D ratio of 1.9. Total Annualized Return (TAR) is 9.6%.
PAR (using Forecast Average—not High—P/E) of 3.5% is less than I seek for a small-size company. If a healthy margin of safety (MOS) anchors this study, then I can proceed based on TAR instead.
To assess MOS, I compare my inputs with Member Sentiment (MS). Based on 70 studies done in the past 90 days (my study and 38 other outliers excluded), averages (lower of mean/median) for projected sales growth, projected EPS growth, Forecast High P/E, and Forecast Low P/E are 13.2%, 12.8%, 30.0, and 17.3 respectively. I am lower across the board.
MS high / low EPS are $15.68 / $8.63 vs. $12.27 / $8.75 (per share). My high EPS is less due mainly to a lower growth rate.
MS LSPF of $155.30 implies a Forecast Low P/E of 18.0: greater than the above-stated 17.3. MS LSPF is 4.0% greater than the default $8.63/share * 17.3 = $149.30 that results in more aggressive zoning. MS LSPF is also 10.9% greater than mine.
MOS is robust in the study because my inputs are [near or] less than [bottom of] historical/analyst/MS averages/ranges. Also backing this assessment is MS TAR exceeding mine by 5.9% per year and my lower LSPF.
Regarding valuation, PEG is 3.1 per my projected P/E: overvalued. Relative Value [(current P/E) / 5-year-mean average P/E] is slightly low at 0.86. M* says stock trades at a 9% discount.
Per U/D, UFPT is a BUY under ~$185/share. BetterInvesting® TAR criterion would be met [319.1 / ((14.87 / 100 ) +1 ) ^ 5] ~ $160 given a forecast high price ~$319 (no dividend).
A 90-day free trial to BetterInvesting® may be secured here (also see link under “Pages” section at top right of this page).
Categories: BetterInvesting® | Comments (0) | PermalinkHSA Strategy (Part 5)
Posted by Mark on September 5, 2025 at 07:00 | Last modified: March 5, 2026 09:18In Part 4, I discussed some different approaches to managing [investment] funds in Health Savings Accounts (HSA). I conclude today by addressing one other question: should the HSA be approached as a portfolio in and of itself or may it be used as one segment of the total portfolio?
Please see the second paragraph of Part 4 for the full disclaimer.
If I’m going to invest a segment of my overall portfolio to invest in individual stocks, then perhaps I want to do that in my HSA where the Triple Tax Advantage (see numbered list) provides most value. This would be great unless one of the stocks ends up a BetterInvesting® “Rule of Five” loser (see The 80% Rule”) thereby sapping the HSA forevermore since contributions are limited. Of course, it could be a “Rule of Five” winner and the latter [uncapped] potential benefit outweighs the former risk.
Treating the HSA as its own diversified portfolio can eliminate the risk of catastrophic loss but I see several disadvantages.
The first disadvantage, as alluded to above, is inefficient asset location. Maximize HSA tax-free compounding by allocating to high-growth equities and move low-growth assets (e.g. bonds) to a Traditional IRA or 401(k) where growth eventually gets taxed as ordinary income.
A second disadvantage is potential fatigue due to management complexity. If aiming to maintain a particular 60/40 or 70/30 equity/bonds split, then manual rebalancing trades will have to be done periodically for what is probably an individual’s smallest account. For those living in CA or NJ where the HSA’s tax-exempt status is not recognized, things get worse because rebalancing can trigger state capital gains taxes. Every dividend must also be tracked for state tax reporting.
A third disadvantage results from many HSA providers offering limited investment options. Many providers also require keeping at least $1,000–$2,000 cash in the account to invest [although a diversified portfolio may include this anyway].
Treating the HSA as a separate portfolio also makes it harder to monitor overall risk exposure. Being conservative in an HSA but aggressive in a 401(k) may result in an overall allocation that doesn’t actually match one’s risk appetite.
Inflation risk is a fifth potential disadvantage: returns on cash and/or bonds not outpacing rising medical costs.
In summary, treating an HSA as a standalone portfolio creates tax friction and management complexity that can erode long-term wealth. The better option seems to be inclusion with the high-growth segment of an overall diversified portfolio.
Categories: Accountability | Comments (0) | PermalinkTXRH Stock Study (3-4-26)
Posted by Mark on September 2, 2025 at 06:56 | Last modified: March 4, 2026 08:29I recently did a stock study on Texas Roadhouse Inc. (TXRH, $181.23).
M* writes:
> Texas Roadhouse Inc is a restaurant company operating predominantly
> in the casual dining segment. The company manages its restaurant
> and franchising operations by concept and, as a result, has
> identified Texas Roadhouse, Bubba’s 33, Jaggers, and retail
> initiatives as separate operating segments. In addition, it has
> identified Texas Roadhouse and Bubba’s 33 as reportable segments.
> Maximum revenue for the company is generated from the Texas
> Roadhouse segment, which is a moderately priced, full-service,
> casual dining restaurant concept offering steaks, a selection of
> ribs, seafood, chicken, pork chops, pulled pork, vegetable plates,
> and an assortment of hamburgers, salads, and sandwiches.
> Geographically, the majority of the firm’s restaurants are in
> the USA, with a few in foreign countries.
Over the past decade, this medium-size company grows sales and EPS at annualized rates of 13.3% and 18.3%, respectively. Lines are mostly up, straight, and parallel except for sales+EPS decline in ’20 (COVID-19 shutdowns) and an EPS dip in ’25. Ten-year EPS R^2 is 0.42 (probably over 0.80 with ’20 excluded) and Value Line (VL) gives an Earnings Predictability score of 40. Shares outstanding decrease 6.5% (0.7%/year).
Over the past decade, PTPM leads peer and industry averages while ranging from 0.8% in ’20 to 9.8% in ’24 with a last-5-year mean of 8.4%. ROE leads peer and industry averages while increasing from 15.7% (’16) to 27.6% (’25) with a last-5-year mean of 27.6%. Debt-to-Capital is less than peer and industry averages despite increasing from 6.5% (leases and rentals not included for ’16) to 40.0% (’25) with a last-5-year mean of 40.6%.
Quick Ratio is 0.38 and Interest Coverage N/A (no long-term debt) per M* who assigns “Wide” [quantitative] Economic Moat and a A grade for Financial Health (BetterInvesting® website). VL rates the company B++ for Financial Strength.
With regard to sales growth:
- YF gives YOY ACE 11.2% and 9.3% for ’26 and ’27 (based on 28 analysts).
- Zacks gives YOY ACE 11.3% and 9.1% for ’26 and ’27, respectively (8 analysts).
- VL projects 9.5% annualized from ’24-’30.
- CFRA projects 11.2% YOY and 10.3% per year for ’26 and ’25-’27, respectively.
- M* offers a 2-year ACE of 10.2%.
I am forecasting below the range at 9.0% per year.
With regard to EPS growth:
- MarketWatch projects 10.3% and 13.5% per year for ’25-’27 and ’25-’28, respectively (based on 33 analysts).
- Nasdaq.com gives ACE 23.1% YOY and 21.9%/year for ’27 and ’26-’28 (11 / 11 / 2 analysts for ’26 / ’27 / ’28).
- Seeking Alpha projects 4-year annualized growth of 15.8%.
- Finviz gives ACE 5-year annualized growth of 14.8% (12).
- LSEG estimates LTG at 15.8%.
- YF gives YOY ACE 3.0% and 22.1% for ’26 and ’27, respectively (29).
- Zacks gives YOY ACE 4.1% and 23.2% for ’26 and ’27 (11) along with 5-year annualized growth of 14.5%.
- VL projects 12.8% annualized from ’24-’30.
- CFRA projects 3.1% YOY and 12.3% per year for ’26 and ’25-’27, respectively.
- M* gives long-term ACE of 12.0% per year.
My 11.0% forecast is below the long-term-estimate range (mean of six: 14.3%). Initial value is ’25 EPS of $6.10/share.
My Forecast High P/E is 25.0. Over the past 10 years (excluding ’20), high P/E ranges from 25.6 in ’22 to 34.2 in ’18 with a last-5-year mean of 29.8 and last-5-year-mean average P/E of 25.0. I am below the 10-year range.
My Forecast Low P/E is 19.0. Over the past 10 years (excluding ’20), low P/E ranges from 17.3 in ’22 to 24.4 in ’25 with a last-5-year mean of 20.1. I am forecasting near bottom of the range [only ’22 and ’24 (17.8) are less].
My Low Stock Price Forecast (LSPF) is $126.00. Default ($115.70) given initial value from above seems unreasonably low at 36.2% less than previous close and 22.2% less than 52-week low. My [arbitrary] selection is 30.5% and 15.3% less, respectively (and results in an effective Forecast Low P/E of 20.7).
Over the past 10 years (excluding ’20), Payout Ratio (PR) ranges from 34.3% in ’21 to 48.8% in ’19 with a last-5-year mean of 42.3%. I am forecasting below the range at 34.0%.
These inputs land TXRH in the HOLD zone with a U/D ratio of 1.6. Total Annualized Return (TAR) is 9.5%.
PAR (using Forecast Average—not High—P/E) of 6.1% is less than I seek for a medium-size company. If a healthy margin of safety (MOS) anchors this study, then I can proceed based on the TAR instead.
To assess MOS, I compare my inputs with Member Sentiment (MS). Based on 102 studies done in the past 90 days (my study and 44 other outliers excluded), averages (lower of mean/median) for projected sales growth, projected EPS growth, Forecast High P/E, Forecast Low P/E, and PR are 10.0%, 11.3%, 29.0, 19.0, and 48.1% respectively. I am lower on all but Forecast Low P/E. VL projects a future average annual P/E of 24.0 that is equal to MS and greater than mine (effectively 22.9).
MS high / low EPS are $11.04 / $6.42 versus my $10.28 / $6.10 (per share). My high EPS is less due to a lower growth rate. VL high EPS of $13.30 soars above both.
MS LSPF of $124.30 implies a Forecast Low P/E of 19.4: greater than the above-stated 19.0. MS LSPF is 1.9% greater than the default $6.42/share * 19.0 = $121.98 that results in more aggressive zoning. MS LSPF is 1.4% less than mine, however.
MOS is robust in the study because my inputs are [near or] less than [bottom of] historical/analyst/MS averages/ranges. Also backing this assessment is MS TAR exceeding mine by 5.2% per year.
Regarding valuation, PEG is 2.0 and 2.4 per Zacks and my projected P/E: slightly overvalued (0.4 per M* seems low enough to be erratum). Relative Value [(current P/E) / 5-year-mean average P/E] is elevated at 1.2. “Quick and Dirty DCF” calculates stock overvalued by 32% (M* currently says 12% premium despite the aforementioned 0.4).
This is Ken Kavula’s Manifest Investing Round Table selection for Feb 2026. My inputs are a bit lower.
Per U/D, TXRH is a BUY under ~$159/share. BetterInvesting® TAR criterion would be met [224.3 / ((13.47 / 100 ) +1 ) ^ 5] ~ $119 given a forecast high price ~$224.
A 90-day free trial to BetterInvesting® may be secured here (also see link under “Pages” section at top right of this page).
Categories: Uncategorized | Comments (0) | Permalink