ARTIVION, INC. (AORT): what the price assumes

In the published model solve dated 2026-Q2, anchored at $26.77, ARTIVION, INC. (AORT) is priced for today's economics sustained for ~13.0 years. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-31 · Source: https://boothcheck.com/report/AORT

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 11: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 9.1% cost of capital; growth searched up to the 25% self-funding ceiling.

How unusual the bet is: elevated (limited comparison data)

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.4%); the inversion above states its own rate.

Per-Model Detail (n=5)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Bullet Takeaways

• The FDA granted full premarket approval to the AMDS Hybrid Prosthesis on June 29, 2026, which removes the institutional review board step hospitals previously had to clear before implanting it.
• The financing structure is the binding constraint: operating income covers the interest bill only 1.1 times, net debt sits near 5.7 times operating income before tax, and the share count has been rising about 5.7% a year.
• Management lowered its full-year 2026 revenue expectation after softer stent graft sales at home and abroad, which resets the bar the next print gets measured against.

Bull Case

The income statement describes an ordinary business, and the business is not ordinary. Trailing operating margin runs at 6.5%. Very little of what remains survives the trip to the bottom of the statement, so return on book value comes in at 2.6%. Read those two figures on their own and you would conclude that Artivion sells something unremarkable at unremarkable prices. What it actually sells is implantable hardware for acute aortic dissection, a condition where the alternative to the device is often death, and the FDA approved its AMDS prosthesis on the strength of a trial reporting a 72% reduction in all-cause mortality at thirty days and a 54% reduction in major adverse events. None of that pricing power is visible in a 6.5% operating margin.

The category tells you what devices like this are worth at the gross line. Edwards Lifesciences (EW) reports gross margin of 77.9%, AtriCure (ATRC) 75.6%, and LeMaitre Vascular (LMAT) 72.4%, each on its own filed figures. That is the economics of implantable cardiovascular hardware. The distance between category-level gross economics and Artivion's reported operating margin is where the money goes: clinical trials, regulatory filings, and the field organization it takes to get a device onto a hospital's shelf and into a surgeon's hands.

LeMaitre Vascular is the instructive comparison, because it shows what a small vascular device maker looks like once it stops spending at that rate. LMAT earns 28.5% operating margins on $256 million of revenue. Artivion runs a revenue base close to twice that size at a fraction of the profitability. The bull case does not require the company to invent anything further. It requires the company to stop paying for what it has already invented.

The portfolio underneath is broader than the aortic story suggests. Stent grafts are 36% of revenue, On-X mechanical valves 23%, preservation services 22% and surgical sealants 17%. The 10-K describes the On-X line as covering aortic and mitral heart valves plus an ascending aortic prosthesis, with distribution of carbon dioxide diffusion catheters and sutures for mitral chordal replacement alongside. Preservation services processes donated cardiac and vascular tissue, which is a genuinely hard business to replicate: it requires donor supply, processing capacity, and a regulatory record nobody builds quickly.

June's approval changed the commercial mechanics rather than the science. Under the prior humanitarian device exemption, a hospital had to obtain institutional review board sign-off before implanting the device, and management had already flagged procurement friction as the reason placements were running behind. That gate is now gone. Removing an administrative barrier from a product whose clinical case is already made is the least expensive growth available to a company in this position.

Bear Case

Operating income covers the interest bill 1.1 times. That one ratio governs more of this story than any product in the catalogue does. Net debt sits near 5.7 times operating income before tax, and the borrowing is not cheap: the FY2025 10-K reports a stated rate of 8.74% on the term loan facility with an effective rate of 9.38%, 7.49% on the revolving facility, and $100.0 million of 4.25% convertible senior notes issued in June 2020. A company earning barely more than what it owes its lenders has no shock absorber, and every operating disappointment lands directly on the equity.

The equity has been absorbing the difference in another way as well. The share count has grown roughly 5.7% a year over four years. The 10-K discloses 916,000 shares granted to employees and officers during 2025 under performance and restricted awards, with an aggregate grant date value of $24.1 million, tied to revenue growth and profitability targets. Holders are paying for this expansion in two currencies at the same time, and only one of them shows up in the interest line.

Then the guidance moved the wrong way. Management lowered its full-year 2026 revenue expectation, pointing to weaker stent graft sales in both international markets and the United States, and to delays placing AMDS starter sets because of hospital procurement processes. Procurement friction is a solvable problem. It is also a plain reminder that a clinically superior device does not walk itself into a hospital budget, and that the timing of a launch is decided by purchasing committees rather than by trial data.

The tissue business carries its own drag and its own open question. Revenues from tissue processing fell 3% during 2025, which the 10-K attributes primarily to a backlog of tissues awaiting release following the 2024 cybersecurity incident. The same filing notes a proposed rule that has sat on the federal regulatory agenda since 2019 under which certain of its preserved tissue products could be reclassified and require a premarket approval application, with the agency deciding how long the products could continue to be supplied during that review.

All of this sits beneath a price paying roughly fifty times company-wide operating income. What that price asks for is growth held at the fastest rate this business can fund from its own earnings, sustained for something over a decade, and only about 14% of comparable fast-growing companies held that kind of level across a full decade. The multiple sits at the very top of the medical device peer distribution. A capital structure this tight is an unusual place from which to underwrite a decade-long compounding run, because the years in which the thesis gets tested are precisely the years in which refinancing terms matter most.

Valuation

Two figures define what is being underwritten. Today's price works out to roughly fifty times company-wide operating income, and inverted, it requires operating profit to compound at the fastest pace the business can self-fund for about 11.5 years. Trailing operating margin is 6.5%, which means most of that compounding has to arrive through profitability rather than through volume alone.

The references make the assumption demanding rather than impossible. The near-term pace is inside what the company has recently delivered, so the growth rate itself is not the stretch; the duration is. Against the device peer group, the multiple sits at the very top of the distribution, well beyond the upper quartile. And among comparable fast-growers, only about 14% sustained a level like this for a decade. The overall read is a high bar, one step below the most extreme end of the scale.

The methods used to triangulate divide sharply and all in one direction. Asset value, earnings power and peer multiples land far below today's price. Only the forward-growth methods reach it, and the nearest of them clears it only by assuming the enterprise multiple investors apply now survives untouched through a six-year projection, with cash flow compounding at the rate the company has grown historically. The meaning of that pattern is specific: this is a bet on durable compounding that the static frames structurally cannot price, not a bet those frames have examined and found cheap.

The peer cohort makes the required improvement concrete. Artivion converts 6.5% of revenue into operating income. Edwards Lifesciences (EW) manages 21.4%, Boston Scientific (BSX) 18.4%, Globus Medical (GMED) 17.2%, LivaNova (LIVN) 13.4% and Merit Medical (MMSI) 12.2%, all on their own filed figures, while LMAT reaches 28.5% on roughly half Artivion's revenue base. The company sits at the bottom of its peer group on profitability while carrying the highest multiple in it. Whether the first of those facts is temporary is the entire investment question, and the answer is a matter of execution rather than of arithmetic.

Solvency is what separates this from most premium-multiple stories. Net debt near 5.7 times operating income before tax, interest covered 1.1 times, and a share count climbing about 5.7% a year leave very little room between a disappointing year and a financing conversation. Management's longer record with its own forecasts is strong, with twenty-two raises and three reaffirmations since 2006 against a single withdrawal, so this year's reduction runs against the pattern rather than with it. Thin coverage does not make the thesis wrong. It shortens the number of quarters available in which to be wrong.

Catalysts

The defining event arrived on June 29, 2026, when the FDA approved the premarket approval application for the AMDS Hybrid Prosthesis. The approval covers acute Debakey Type I aortic dissections presenting with clinical or radiographic malperfusion, which the company estimates at roughly 60% of all Debakey Type I dissections, and rests on the PERSEVERE trial, which at thirty days showed a 72% reduction in all-cause mortality and a 54% reduction in primary major adverse events including stroke, dialysis-requiring renal failure and myocardial infarction. The commercially important detail is procedural: hospitals no longer need institutional review board approval to implant the device, a requirement that came with the earlier humanitarian exemption.

That approval landed after a first quarter that the market did not like. Revenue rose 18% on a reported basis to $116.3 million, but management lowered its full-year 2026 revenue and profitability targets, attributing the change to lower-than-expected stent graft sales in international markets and the United States and to delayed AMDS starter set placements caused by hospital procurement hurdles. The stock reacted to the guidance rather than to the growth.

That sets up a clean test over the next two reports. The procurement obstacle management named in May is precisely what the June approval removes, so the placement rate for AMDS starter sets is the single most informative line to watch. Alongside it sits the stent graft line, which is 36% of revenue and the source of the shortfall, and the tissue processing business, which is still working through the release backlog left by the 2024 cybersecurity incident. One of those three explains whether the reset guidance was conservatism or a trend.

Peer Cohorts (Per Segment, With Filing Citations)

Medical Devices (reported)

• ATRC (AtriCure, Inc.)
• FY2025 10-K: …a coverage denial. Outside of the United States, third-party reimbursement varies widely by geography and by the type of therapy in which our devices are used. For example, even though a new medical device may have been approved for commercial distribution, we may find limited demand for the device until coverage and…
• FY2025 10-K: • withdrawing 510(k) clearance or PMAs that have already been granted; and • criminal prosecution. If any of these events were to occur, we could lose customers and our production, product sales, business, results of operations and financial condition would be harmed. We are also subject to medical device reporting…
• GMED (GLOBUS MEDICAL, INC.)
• FY2025 10-K: …design of a device that is approved through the PMA process. Certain other changes to an approved device also require the submission of a new PMA, such as when the design change causes a different intended use, mode of operation, and technical basis of operation, or when the design change is so significant that a new…
• FY2025 10-K: …entities or other third parties, including Relators (whistleblowers) who can file complaints on behalf of the government and on their own behalf under the federal civil False Claims Act ("FCA"), could interpret these laws and our efforts to comply with them differently and assert otherwise. We discuss below the…
• LIVN (LivaNova PLC)
• FY2025 10-K: …cardiopulmonary products, including HLMs, oxygenators, autotransfusion systems, perfusion tubing systems, cannulae, and other related accessories, and provides services related to certain of these products. In particular, the Cardiopulmonary segment includes the Essenz Perfusion System, the Company's next-generation…
• FY2025 10-K: …manner, maintain high-quality manufacturing processes, and successfully market and sell these products. LivaNova's primary medical device competitors in the Cardiopulmonary and Neuromodulation product groups are Terumo Medical Corporation, Maquet Medical Systems, Medtronic plc, Haemonetics Corporation, Spectrum…
• EW (EDWARDS LIFESCIENCES CORPORATION)
• FY2025 10-K: …$628.1 million over 2024, driven primarily by sales growth of our TAVR and TMTT products. Our gross profit increased in 2025, driven by our sales growth. Gross profit as a percentage of sales decreased primarily due to higher operational expenses. The decrease in our net income and diluted earnings per share in 2025…
• FY2025 10-K: …considerations, regulatory reform, industry and customer consolidation, and evolving patient needs. The ability to provide products and technologies that demonstrate value while improving clinical outcomes is becoming increasingly important for medical technology manufacturers. We believe that we are a leading global…
• BSX (BOSTON SCIENTIFIC CORP)
• FY2025 10-K: …costs, improve efficiencies and/or increase patient access. Although we believe our products and technologies generate favorable clinical outcomes, value and cost efficiency, while also being less invasive than alternatives, the resources and evidence necessary to demonstrate value to our customers, patients, payers…
• FY2025 10-K: …technological changes in the medical devices industry or low-cost competitive offerings, which could have an adverse effect on our business, financial condition or results of operations. The medical device markets in which we participate are highly competitive. We encounter significant competition across our product…
• MMSI (MERIT MEDICAL SYSTEMS INC)
• FY2025 10-K: …("Teleflex"), Cook Medical Incorporated ("Cook Medical"), Medtronic plc ("Medtronic"), Boston Scientific Corporation ("Boston Scientific"), and Becton, Dickinson and Company ("BD"). Our primary competitors in our cardiac intervention market are BD, Teleflex, Medtronic, Abbott Laboratories, Terumo Corporation, Edwards…
• FY2025 10-K: …operating segments: cardiovascular and endoscopy. For information relating to our operating segments and product categories, see Note 13 Segment Reporting and Foreign Operations to our consolidated financial statements set forth in Item 8 of this report and Management's Discussion and Analysis set forth in Item 7 of…
• AXGN (AXOGEN, INC.)
• FY2025 10-K: …with Evergen for the Axoguard products. Evergen believes it has know-how and trade secrets with respect to its ECM technology that provides certain additional competitive obstacles to third parties, in addition to those obstacles existing in view of Axogen-owned IP. Government Regulations U.S. Government Regulation…
• FY2025 10-K: …Clearance and Approval Requirements - Medical Devices Unless an exemption applies, each medical device distributed commercially in the U.S. requires either a 510(k) pre-market notification submission or a Pre-Market Approval ("PMA") Application to the FDA, or other FDA regulatory authorization. Medical devices are…

Preservation Services (reported)

• ATRC (AtriCure, Inc.)
• FY2025 10-K: …over the service period. The Company estimates the fair value of PSAs with a performance condition based on the closing stock price on the date of grant assuming the performance target will be achieved and may adjust expense over the performance period based on changes to estimates of performance target achievement.…
• FY2025 10-K: …us-gaap:SalesRevenueNetMember 2024-01-01 2024-12-31 0001323885 atrc:MedicalDevicesMember us-gaap:CustomerConcentrationRiskMember us-gaap:SalesRevenueNetMember 2023-01-01 2023-12-31 0001323885 atrc:MedicalDevicesMember us-gaap:CustomerConcentrationRiskMember us-gaap:AccountsReceivableMember 2025-01-01 2025-12-31…
• PEN (Penumbra, Inc)
• FY2025 10-K: …future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. To the extent actual forfeiture results differ from the 81 Table of Contents Penumbra, Inc. Notes to Consolidated Financial Statements (Continued) estimates, the…
• FY2025 10-K: …agencies over the lifetime of the patents. Future maintenance fees will also need to be paid on other patents that may be issued to us. We have systems in place to remind us to pay these fees, and we employ outside firms to remind us or our licensor to pay annuity fees due to patent agencies on our patents and…
• MMSI (MERIT MEDICAL SYSTEMS INC)
• FY2025 10-K: L.L.C., and Shareholder Representative Services LLC, dated as of May 16, 2025.* ​ 10-Q ​ 2.1 ​ July 30, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 3.1 ​ Second Amended and Restated Articles of Incorporation.* ​ 10-Q ​ 3.1 ​ August 9, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 95 Table of Contents 3.2 ​ F ourth Amended and Restated Bylaws.* ​ 8-K ​…
• FY2025 10-K: Thomas J. Gunderson ​ ​ ​ ​ ​ /s/ LAURA S. KAISER ​ Director Laura S. Kaiser ​ ​ ​ ​ ​ /s/ MICHAEL R. MCDONNELL ​ Director Michael R. McDonnell ​ ​ ​ ​ ​ /s/ SILVIA M. PEREZ ​ Director Silvia M. Perez ​ ​ ​ ​ ​ /s/ LYNNE N. WARD ​ Director Lynne N. Ward ​ ​ ​ ​ 103
• LMAT (LEMAITRE VASCULAR, INC.)
• FY2025 10-K: …the effectiveness of our internal control over financial reporting could be adversely affected. Our tissue processing and preservation services are subject to a variety of risks, including those related to the procurement of human tissue and regulatory requirements. Our ability to successfully provide RestoreFlow…
• FY2025 10-K: …with the removal, transportation, implantation, processing, preservation, quality control, and storage of a human organ. The purpose of this statutory provision is to allow for compensation for legitimate services. We believe that, to the extent our activities are subject to NOTA, we meet this statutory provision…
• TFX (TELEFLEX INCORPORATED)
• FY2025 10-K: …a reserve is required include (i) current sales data and historical return rates, (ii) estimates of future demand, (iii) competitive pricing pressures, (iv) new product introductions, (v) product expiration dates, and (vi) component and packaging obsolescence. We review the net realizable value of inventory each…
• FY2025 10-K: …contingencies as a result of environmental laws and regulations that in the future may require us to take further action to correct the effects on the environment of prior disposal practices or releases of chemical or petroleum substances by us or other parties. Much of this liability results from the U.S.…
• TMDX (TransMedics Group, Inc.)
• FY2025 10-K: Transplant aircraft 10 years Transplant aircraft equipment 10 years Flight school aircraft 5 years OCS Consoles 5 years Manufacturing equipment 5 years Internal-use software 5 years Computer equipment and software 3 years Laboratory equipment 3 years Office, trade show and training equipment 5 years Leasehold…
• FY2025 10-K: …licensed to us, to protect our trade secrets or know-how, to defend against claims of infringement of the rights of others or to determine the scope and validity of the proprietary rights of others. Litigation could be costly and could divert our attention from other functions and responsibilities. Adverse…
• ICUI (ICU MEDICAL INC/DE)
• FY2025 10-K: …incident response, end user awareness and vulnerability management. Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include: briefings from internal security personnel; threat…
• FY2025 10-K: …2025-01-01 2025-12-31 0000883984 us-gaap:WarrantyReservesMember 2025-12-31 0000883984 us-gaap:ValuationAllowanceOfDeferredTaxAssetsMember 2025-01-01 2025-12-31 0000883984 us-gaap:ValuationAllowanceOfDeferredTaxAssetsMember 2025-12-31 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒…
• ESTA (Establishment Labs Holdings Inc.)
• FY2025 10-K: …policies relate to the more significant areas involving management's estimates and judgments. 73 Table of Contents Revenue Recognition We recognize revenue related to sales of products to distributors or directly to customers in markets where it has regulatory approval, net of discounts and allowances. The Company…
• FY2025 10-K: …the face of the income statement. It is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively. The Company is currently evaluating the potential effect that the…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.