Buy or Sell Alphatec Stock?

Alphatec (ATEC) stock has fallen 22% during the past day, and is currently trading at $17.59. We believe there are only a couple of things to fear in ATEC stock given its overall Moderate operating performance and financial condition. This is aligned with the stock’s Moderate valuation because of which we think it is Fairly Priced.

Below is our assessment:

We know that clients love their favorite stocks, but single-stock risk can undo years of gains. Savvy financial advisors diversify intelligently – learn how our Boston-based wealth management partner can help.

Let’s get into details of each of the assessed factors but before that, for quick background: With $2.7 Bil in market cap, Alphatec offers advanced medical technologies for surgical treatment of spinal disorders, distributing products through independent distributors and direct sales representatives in the United States.

[1] Valuation Looks Moderate

This table highlights how ATEC is valued vs broader market. For more details see: ATEC Valuation Ratios

[2] Growth Is Very Strong

• Alphatec has seen its top line grow at an average rate of 31.8% over the last 3 years
• Its revenues have grown 27% from $573 Mil to $728 Mil in the last 12 months
• Also, its quarterly revenues grew 30.4% to $197 Mil in the most recent quarter from $151 Mil a year ago.

This table highlights how ATEC is growing vs broader market. For more details see: ATEC Revenue Comparison

[3] Profitability Appears Very Weak

• ATEC last 12 month operating income was $-74 Mil representing operating margin of -10.1%
• With cash flow margin of 4.8%, it generated nearly $35 Mil in operating cash flow over this period
• For the same period, ATEC generated nearly $-155 Mil in net income, suggesting net margin of about -21.3%

This table highlights how ATEC profitability vs broader market. For more details see: ATEC Operating Income Comparison

[4] Financial Stability Looks Very Strong

• ATEC Debt was $591 Mil at the end of the most recent quarter, while its current Market Cap is $2.7 Bil. This implies Debt-to-Equity Ratio of 22.0%
• ATEC Cash (including cash equivalents) makes up $156 Mil of $787 Mil in total Assets. This yields a Cash-to-Assets Ratio of 19.8%

[5] Downturn Resilience Is Weak

ATEC has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.

2022 Inflation Shock

• ATEC stock fell 66.1% from a high of $18.78 on 22 March 2021 to $6.36 on 21 June 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 13 July 2023
• Since then, the stock increased to a high of $22.68 on 8 January 2026 , and currently trades at $17.59

 
2020 Covid Pandemic

• ATEC stock fell 69.7% from a high of $7.47 on 16 January 2020 to $2.26 on 23 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 8 October 2020

 
2008 Global Financial Crisis

• ATEC stock fell 82.3% from a high of $77.28 on 19 February 2008 to $13.68 on 16 March 2009 vs. a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 15 March 2010

But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read ATEC Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.