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what it is
Pro-Dex makes powered surgical tools and air motors, then sells them to bigger medical device and industrial customers.
how it gets paid
Last year Pro-Dex made $67M in revenue. orthopedic surgical drivers was the main engine at $24M, or 36% of sales.
why it's growing
Revenue grew 23.7% last year. Gross margin was 29.9%, and the revenue spike means Pro-Dex converted a huge order wave into profit fast.
what just happened
The quarter was absurd on its face: $37M in revenue, up 99% vs. prior year, with EPS up 214% to $2.07.
At a glance
C++ balance sheet — some cracks in the foundation
40/100 earnings predictability — expect surprises
12.2x trailing p/e — the market's not buying it — or you found a deal
20.2% return on capital — every dollar works hard here
$2.67 fy2025 eps est
xvary composite: 41/100 — below average
What they do
Pro-Dex makes powered surgical tools and air motors, then sells them to bigger medical device and industrial customers.
Pro-Dex wins by making the hard-to-copy guts of surgical tools. VL says it has patented torque-limiting software and proprietary sealing, which is engineer-speak for tools that stay precise after sterilization and repeated use. With just 148 employees and a 20.2% return on capital, you are looking at a small shop that turns niche know-how into real profits.
How they make money
$67M
annual revenue · their business grew +23.7% last year
orthopedic surgical drivers
$24M
maxillofacial surgical drivers
$13M
surgical shavers
$11M
rotary air motors
$16M
other OEM components and service
$3M
The products that matter
orthopedic surgical tools
Surgical Drivers & Shavers
$45.6M · 68% of revenue
it's the core $45.6M business. the catch is that one buyer alone accounts for 68% of company sales, so product strength and customer concentration are tangled together.
core segment
industrial power components
Rotary Air Motors
$21.4M · 32% of revenue
this $21.4M line is the diversification argument. it matters, but it is not yet large enough to make the concentration problem disappear.
diversifier
Key numbers
20.2%
return on capital
Return on capital → profit generated from money invested in the business → so what: Pro-Dex turns niche manufacturing into returns most small industrial companies would envy.
17.9%
operating margin
Operating margin → profit after running the business, before interest and taxes → so what: this is a real business, not a science project.
$67M
annual revenue
That is tiny in public-market terms. You are buying a niche operator, which means more upside and more lumpiness.
12.2x
trailing p/e
P/E → price divided by earnings → so what: you are paying 12.2 years of current profits for a company that just grew revenue 23.7%.
Financial health
C++
strength
- balance sheet grade C++ — below average — limited financial resources
- risk rank 3 — safer than 50% of stocks
- price stability 10 / 100
- long-term debt $9M (6% of capital)
C++ — below average. watch for debt servicing and cash burn.
Total return vs. market
Return history isn't available for PDEX right now.
source: institutional data · return history unavailable
What just happened
beat estimates
The quarter was absurd on its face: $37M in revenue, up 99% vs. prior year, with EPS up 214% to $2.07.
Gross margin was 29.9%, and the revenue spike means Pro-Dex converted a huge order wave into profit fast. Contrast that with FY2024 EPS of $0.60 from VL. This business can look sleepy until one quarter rewrites the year.
$37M
revenue
$2.07
eps
29.9%
gross margin
the number that mattered
The number that mattered was 99% revenue growth, because for a company with just $67M in trailing annual sales, one giant quarter changes the whole valuation debate.
source: company earnings report, 2026
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What could go wrong
the #1 risk is losing or shrinking the largest surgical-tools customer relationship.
med
Customer concentration
One customer drives 68% of revenue. If that account cuts orders, the income statement feels it immediately.
68% of sales is exposed to a single relationship. That's not a footnote. That's the business model risk.
med
Contract dependence
The contract extension in December 2025 helped, but renewals are still events here. This is a supplier story where one negotiation can move the stock.
Extension risk does not vanish because the last renewal went through. It just moves to the next date on the calendar.
med
Margin pressure
Gross margin is 29.9% and operating margin is 17.9%. Those are good numbers for a niche manufacturer, but not so high that you can absorb a major pricing reset without pain.
If the biggest customer gets more negotiating power, margin is where you would see it first.
med
Small-cap volatility
Price stability is 10/100 and the stock has traded between $23 and $70 over the last 52 weeks. Add a C++ balance sheet and $9M of long-term debt, and you get a name that will not hide from bad news.
This risk affects valuation more than operations, but for you as a shareholder that still counts.
If the largest customer pulls back, up to 68% of revenue is exposed immediately. That's the number that matters.
source: institutional data · regulatory filings · risk analysis
Pay attention to
concentration
The 68% customer number
This is the key metric. If it stays near 68%, the diversification story is still mostly a story.
calendar
Q3 2026 results
Results are estimated for late April 2026. You want updated customer-mix commentary more than a clean EPS headline.
estimates
Whether $67M holds
The current fy2026 revenue estimate already slipped from $68M to $67M. More cuts would tell you confidence is fading.
margin
Gross margin at 29.9%
If margin weakens while concentration stays high, the company loses both bargaining power and valuation support at the same time.
Analyst rankings
earnings predictability
40 / 100
in human-speak, analysts do not view PDEX as a smooth quarter-to-quarter story.
risk rank
3
That puts it around the middle of the pack on overall risk. The business is viable. The stock can still be jumpy.
valuation check
14.6x
Trailing p/e sits below the 15.9x peer median. You're getting a discount, but it comes attached to concentration.
source: institutional data
Institutional activity
institutional ownership data for PDEX is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$41
current price
n/a
target midpoint · n/a from current
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