TELEFLEX INCORPORATED (TFX): what the price assumes

In the published model solve dated 2026-Q2, anchored at $136.94, TELEFLEX INCORPORATED (TFX) is priced for +7.1% growth. 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 2026-07-11.

Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/TFX

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 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 7.2% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~8.5pp.

Reconcile: at the x-ray's 9.3% required return this reads ~23.1%/yr; the models below use their own rates.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.

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: Relative, Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.6%); the inversion above states its own rate.

Per-Model Detail (n=8)

Solvency

Leverage and coverage are computed on normalized mid-cycle operating income (mid-cycle margin 16.6%); the trailing year was depressed.

Bullet Takeaways

• Teleflex is mid-swap: Biotronik's vascular intervention portfolio came in during 2025 for a net initial payment of $825.2 million, while the Acute Care, Interventional Urology, and OEM businesses "meet accounting requirements to be classified as discontinued operations and held for sale as of December 31, 2025" per the FY2025 10-K, with $2.03 billion in sale agreements signed.
• The biggest risk is leverage against earnings that have not yet recovered: net debt of $2.4 billion runs at roughly five times mid-cycle operating income with interest covered about 4.3 times, and the deleveraging path leans on divestiture proceeds that face a Federal Trade Commission second request received in March 2026.
• Watch the July 30, 2026 earnings print and the third quarter for the targeted close of the roughly $1.5 billion OEM sale; management expects the acquired vascular products to grow 6 percent or better in constant currency in 2026.

Bull Case

Follow the capital and the company's view of where value lives becomes unusually explicit. Teleflex paid a net initial $825.2 million for Biotronik's vascular intervention business in the third quarter of 2025, adding drug-coated balloons, stents, and catheters to an interventional line the FY2025 10-K describes as "a diverse portfolio of coronary catheters, structural heart support devices" built for the cath lab. At the same time it agreed to sell three businesses that never fit that story: the OEM unit to Montagu and Kohlberg for roughly $1.5 billion, and Acute Care plus Interventional Urology to Intersurgical for $530 million, about $1.8 billion net of tax in combined proceeds. Buy the category with procedure growth, sell the slower ones, use the proceeds to repair the balance sheet. Portfolio surgery, performed on itself.

The early evidence supports the direction. Americas net revenues rose from $1,156.9 million in 2024 to $1,279.2 million in 2025 per the 10-K's segment results, and management expects the acquired vascular products to deliver constant currency growth of 6 percent or better beginning in 2026. The international engine was already running: EMEA, roughly 38 percent of revenue, has compounded around 5.5 percent a year over recent years, with Asia close behind near 6 percent. On the first quarter call, management pointed to improving momentum in the second half of 2026 as the Biotronik integration expands the company's cath-lab presence and cross-selling starts to register. This is also a company its rivals treat as a fixture: Merit Medical's own 10-K names Teleflex first among its primary competitors, ahead of Cook Medical, Medtronic, Boston Scientific, and Becton Dickinson.

The quiet tell is capital returned while the reshape was underway. The share count has declined about 1.7 percent a year over the past four years, so holders have been accumulating a slightly larger claim on the business through the noisiest stretch of its restructuring. And the bet the price asks for is not heroic. At about 24 times mid-cycle operating income, the market wants roughly 6.8 percent annual operating growth for five years, a pace within the range the business has recently delivered. On revenue, meanwhile, the price sits at about half what sector sales multiples would defend, so a recovery toward the company's own 16.6 percent through-cycle margin does the heavy lifting without requiring any re-rating of the sales the company already books. If the divestitures close on schedule and the interventional mix grows into its margin, the requirement starts to look ordinary.

Bear Case

The advantage being chipped away is pricing power over the hospital customer. Teleflex's own 10-K concedes where the leverage sits: adverse reimbursement decisions can discourage customers from selecting its products, and group purchasers act "as a result of their purchasing power" to push prices down. Peer filings describe the same dynamic from the other side; Penumbra's 10-K notes that "Manufacturers of medical devices have a history of price competition". The erosion is visible in Teleflex's own ledger. The Interventional Urology North America unit absorbed a "$240.0 million non-tax deductible goodwill impairment charge" in 2024 before being marked for sale, and the North American vascular franchise, about a fifth of revenue, has been flat to slightly negative over three years. The businesses being divested are not spare parts; they are the parts that stopped defending their prices.

The valuation only works if the reader agrees to look past the reported numbers. Trailing operating income on the EDGAR quarterly series is negative, roughly $220 million below zero, dragged down by impairment and separation charges; the price instead capitalizes a through-cycle margin of 16.6 percent, near $466 million of normalized operating profit, at about 24 times, and asks for roughly 6.8 percent annual growth for five years. The rate is not exotic. The persistence is the stretch: five uninterrupted years of it from a company whose net cash provided by operating activities from continuing operations fell to $96.7 million in 2025 from $301.9 million a year earlier, per the 10-K's cash flow statement. If the growth does not persist, the multiple on normalized earnings compresses toward what the earnings-power and book-value lenses already say, and those sit at half the price or less.

The bridge to a repaired balance sheet runs through regulators and buyers, not just execution. Net debt is $2.4 billion against interest coverage of about 4.3 times, leverage that runs a bit over five times mid-cycle operating income, and the deleveraging plan leans on roughly $1.8 billion of net divestiture proceeds. The Federal Trade Commission issued a second request in March 2026 on the Acute Care and Interventional Urology sale, the kind of review that can delay a close or change its conditions. Smaller irritants stack on top: the 10-K discloses that a foreign tax authority denied the company's request in October 2025 to reassess previously filed returns tied to the Palette acquisition. None of these alone breaks the thesis. Together, against 4.3 times coverage and a first half spent absorbing an $825 million acquisition, they leave little room for the second half of 2026 to disappoint.

Valuation

Two versions of Teleflex's operating income exist at the moment, and the market has picked one. The trailing twelve months on the EDGAR quarterly series show operating income around negative $220 million, a figure dominated by impairment and separation charges rather than product economics; the company's segment ledger, which excludes those items, shows positive operating profit, and the FY2025 10-K presents results "on a continuing operations basis to reflect the impact of the Strategic Divestitures". At $135.63 (July 10, 2026) the price pays about 24 times mid-cycle operating income, applying the company's own 16.6 percent through-cycle margin to roughly $2.8 billion of trailing revenue, near $466 million of normalized operating profit. That price embeds roughly 6.8 percent annual operating growth sustained for about five years. The pace itself sits within what the business has recently delivered; the demand is that it persist.

The methods split along an unusual line. On revenue, the price looks cheap: sector price-to-sales reads land at roughly double today's price. On what that revenue currently earns, the price looks expensive: it sits about 2.7 times above the earnings-power read (normalized earnings capitalized with no growth credit), about double the book-value-based reads, and about 1.8 times what the EBITDA-at-sector-multiple lens defends. The one growth path that runs, a tapered revenue trajectory near 8 percent with the terminal sales multiple held flat at today's level, still lands about a fifth below the price. Read together, the pattern describes a margin-recovery bet. The market is not paying for growth the company lacks; it is paying for profitability the company used to have, on sales it already books, such as the Americas revenue the 10-K reports rising from $1,156.9 million in 2024 to $1,279.2 million in 2025.

The balance sheet can carry that bet, but with less slack than the sector norm. Net debt of $2.4 billion runs a bit over five times mid-cycle operating income on a pre-tax basis, interest is covered about 4.3 times, the company is not burning cash, and the share count has fallen about 1.7 percent a year over four years. The agreed divestitures, about $1.8 billion net of tax if both close, would reset that leverage in a single step, which is why the second-half 2026 closing calendar matters as much to this valuation as any quarterly print.

Catalysts

The second half of 2026 is where this story resolves or stalls. Teleflex reports second quarter results on July 30, 2026. Behind the print sit two closings: the OEM sale to Montagu and Kohlberg, roughly $1.5 billion and targeted to close in the third quarter of 2026, and the $530 million Acute Care and Interventional Urology sale to Intersurgical, expected in the second half. The second transaction has been under a Federal Trade Commission second request since March 2026, so the review's pace, not management's calendar, sets the real timeline. Roughly $1.8 billion of net proceeds and the resulting deleveraging hang on those dates.

The operational watch item is the Biotronik integration. Management has guided the acquired vascular intervention products to constant currency growth of 6 percent or better in 2026 and pointed to improving momentum in the second half as the expanded cath-lab presence opens cross-selling opportunities. First quarter growth leaned on the ligation clip line and some order timing in instruments, so the July print is the first clean test of whether the interventional thesis is producing organic acceleration rather than acquisition arithmetic. Commentary on tariffs and remediation costs, which management has flagged as variables for 2026 margins and leverage, will signal how much of the divestiture proceeds arrive intact.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• MMSI (MERIT MEDICAL SYSTEMS INC)
• FY2025 10-K: …of cardiology, radiology, oncology, critical care and endoscopy. This marketplace is characterized by rapid technological advancement, industry and customer consolidation, customer demands for price reductions, regulatory reform, and evolving patient needs. We compete with companies of varying sizes. Many of our…
• 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…
• PEN (Penumbra, Inc)
• FY2025 10-K: …or regulatory changes to reimbursement policies could potentially limit the amount which healthcare providers may be willing to pay for medical devices. Competition The medical device industry is intensely competitive, subject to rapid change and significantly affected by new product introductions and other market…
• FY2025 10-K: …condition and cash flows. We may not be able to achieve or maintain satisfactory pricing and margins for our products. Manufacturers of medical devices have a history of price competition, and we can give no assurance that we will be able to achieve satisfactory prices for our products or maintain prices at the…
• ATEC (Alphatec Holdings, Inc.)
• FY2025 10-K: …maintaining a steady supply can sometimes be challenging. We have not experienced significant difficulty in locating and obtaining the materials necessary to fulfill our production requirements and we have not experienced a meaningful disruption to sales orders. Competition Although we believe that our current broad…
• FY2025 10-K: …effectively. The market in which we operate is highly competitive, subject to rapid technological change and affected by new products and market activities of industry participants. Our competitors include numerous large and well-capitalized companies such as Medtronic Sofamor Danek, a subsidiary of Medtronic; Depuy…
• GMED (GLOBUS MEDICAL, INC.)
• FY2025 10-K: …sales, operating results, and growth may be negatively affected. Our industry is intensely competitive, subject to rapid change and highly sensitive to the introduction of new products or other market activities of industry participants. We believe that our significant competitors are Medtronic, DePuy Synthes,…
• FY2025 10-K: …GLOBUS MEDICAL, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) conclusions reached after considering relevant factors such as economic similarity, customer base, regulatory environment, production processes, nature of services and products provided, and our comprehensive approach to…
• AORT (ARTIVION, INC.)
• FY2025 10-K: …and awards were excluded from the calculation of diluted weighted-average common shares outstanding as these would be antidilutive to the net loss. 16. Segment and Geographic Information We have two reportable segments organized according to our products and services: Medical Devices and Preservation Services. The…
• FY2025 10-K: …and tissue service providers with greater resources and we may not be able to compete effectively. The market for our products and services is competitive and affected by new product introductions and activities of other industry participants, including the introduction of novel products and therapies aimed at…
• PODD (INSULET CORPORATION)
• FY2025 10-K: …• our identification of opportunities and development of appropriate modifications to our Omnipod technology to address the needs and parameters required for drug-delivery opportunities; • our achievement of satisfactory development and pricing terms with the pharmaceutical companies that sell such drugs that would…
• FY2025 10-K: …of factors, including factors related to our operating performance as a high-growth company and the operating performance of our competitors. At times, the fluctuations in the market price of our common stock have been unrelated or disproportionate to our operating performance. In particular, the U.S. equity markets…
• DXCM (DEXCOM, INC.)
• FY2025 10-K: …insulin delivery devices. We are also aware of companies outside the traditional medical device sector that are attempting to develop competitive products and services, including for the general health and wellness, or population health space. Some of the companies developing or marketing competing devices are large…
• FY2025 10-K: …Such competitors may benefit from guidance issued on January 6, 2026 by the FDA's Center for Devices and Radiological Health that effectively broadens the range of products that may be considered "general wellness devices," including wearables that provide readings around bodily functions and vital signs such as…
• IRTC (iRhythm Holdings, Inc.)
• FY2025 10-K: …health space. These competitors and potential competitors may introduce new products and services that directly or indirectly compete with our iRhythm Services and iRhythm ACM Systems. Future competition may also come from manufacturers of wearable fitness products or large information technology companies focused on…
• FY2025 10-K: …and other physicians with whom we have had little contact and who may require a different type of marketing effort. If we are unable to increase orders for our iRhythm Services, expand reimbursement for our iRhythm Services, or successfully develop and commercialize new services and related devices, our revenue and…

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.
• 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.