Thoughts on the Treace Medical Concepts correction.

Earlier this year I wrote about all the things that Treace is doing right here – Stepping into the future: How Treace Medical Concepts is revolutionizing F&A surgery with a relentless culture.

After the stock correction, many ortho friends have asked me to comment about Treace Medical Concepts. So here you go. (Disclaimer).

The Facts

The Treace fundamentals are best in class. A quick look at the Q3 2023 numbers.

1/ Treace is the fastest growing public traded ortho company. Period.

2/ This is not a small business anymore. Treace has a 200M+ run rate.

3/ Treace has strong gross margins >80%.

4/ Treace is growing top line revenue at 36% YTD.

5/ Treace has war chest of cash for future growth and potential acquisitions.

6/ Treace has a chance to reach positive EBITDA in 2024.

My Opinion

1/ The Street got hooked on the stellar growth in the 45-65% range, and when Q3 this year reported 23% growth the Street put Treace in the penalty box temporarily. See annual growth rates below.

2/ The market is really skittish and most ortho company stock prices are down over the last 12 months.