{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "KIDS",
  "name": "OrthoPediatrics Corp.",
  "url": "https://frontierpicks.com/dossiers/KIDS/",
  "json_url": "https://frontierpicks.com/dossiers/KIDS.json",
  "status": "WATCHLIST",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a7",
    "n": 7
  },
  "current_thesis": "OrthoPediatrics shares are more likely to lag the S&P 500 because the $33.67 close on 11 November 2026 sits above six of seven post-report analyst targets despite 19% sales growth. Preliminary fourth-quarter revenue, expected about mid-January 2027, shows whether sales justify that price.",
  "invalidation_trigger": "A daily close above $36.70, beyond the 2026-11-04 intraday 52-week high of $34.53, would show the shares leading the S&P 500. Preliminary fourth-quarter revenue that lifts full-year 2026 sales above the $273.0 million top of guidance would also prove the call wrong.",
  "catalyst_date": "2026-12-02",
  "portfolio": null,
  "pick": null,
  "themes": [
    "medtech-diagnostics"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "OrthoPediatrics at Stifel 2026 Healthcare Conference 2026: growth broadens",
      "url": "https://uk.investing.com/news/stock-market-news/orthopediatrics-at-stifel-2026-healthcare-conference-2026-growth-broadens-93CH-4975362",
      "date": "2026-11-11"
    },
    {
      "title": "Nearly 42,000 children were helped in one quarter. OrthoPediatrics raised its 2026 revenue forecast.",
      "url": "https://www.stocktitan.net/news/KIDS/ortho-pediatrics-corp-reports-third-quarter-2026-financial-results-uf2swgza2wx8.html",
      "date": null
    },
    {
      "title": "OrthoPediatrics launches VerteGlide scoliosis system",
      "url": "https://www.stocktitan.net/news/KIDS/ortho-pediatrics-announces-full-commercial-launch-of-verte-glide-xdfkmf0cjzu8.html",
      "date": "2026-11-09"
    },
    {
      "title": "OrthoPediatrics Announces Full Commercial Launch of VerteGlide® Spinal Growth Guidance System",
      "url": "https://www.biospace.com/press-releases/orthopediatrics-announces-full-commercial-launch-of-verteglide-spinal-growth-guidance-system",
      "date": null
    },
    {
      "title": "OrthoPediatrics to Participate in Upcoming Conferences",
      "url": "https://www.globenewswire.com/news-release/2026/11/02/3393731/0/en/orthopediatrics-to-participate-in-upcoming-conferences.html",
      "date": "2026-11-02"
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter 2026 revenue was a record $72.7 million, up 19% from $61.2 million; US revenue rose 19% and international 18%.",
      "source": "Q3 2026 earnings release, Form 8-K",
      "as_of": "2026-10-27"
    },
    {
      "claim": "Full-year 2026 revenue guidance was raised to $270.0–$273.0 million from $265.0–$269.0 million; the adjusted EBITDA target of about $25 million was kept.",
      "source": "Q3 2026 earnings release, Form 8-K",
      "as_of": "2026-10-27"
    },
    {
      "claim": "Third-quarter free cash flow was $1.6 million versus $3.4 million used a year earlier; adjusted EBITDA was a record $6.9 million versus $6.2 million.",
      "source": "Q3 2026 earnings release, Form 8-K",
      "as_of": "2026-10-27"
    },
    {
      "claim": "Cash, equivalents, short-term investments and restricted cash totaled $44.9 million; term loan $48.6 million and convertible note $49.0 million.",
      "source": "Q3 2026 10-Q balance sheet",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Price targets raised: Lake Street $38, Canaccord Genuity $30, Piper Sandler $30, BTIG $30, TD Cowen $28, Truist $28 (Hold, from $22), Stifel $27.",
      "source": "Benzinga analyst ratings",
      "as_of": "2026-10-28"
    },
    {
      "claim": "Management targeted at least $6 million of fourth-quarter free cash flow, said VerteGlide is in use at more than 40 hospitals, and expects eLLi FDA IDE approval with first cases in early 2027.",
      "source": "Stifel 2026 Healthcare Conference fireside chat, per Investing.com",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Squadron Capital LLC, a 10% owner, sold 302,369 shares at $21.01 on 2026-09-10, after selling 336,831 shares at an average $23.04 from 2026-08-28 to 2026-09-01 and 22,500 at $23.35 on 2026-09-02.",
      "source": "SEC Form 4 filings, 2026-09-01 to 2026-09-11",
      "as_of": "2026-09-10"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Healthcare",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
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              "yoy_pct": 15.4
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              "yoy_pct": 13.3
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              "yoy_pct": 17
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              "value_musd": 61.2,
              "yoy_pct": 12.2
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              "restated": null,
              "value_musd": 61.1,
              "yoy_pct": 15.7
            }
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        },
        "gross_margin": {
          "status": "ok",
          "quarters": [
            {
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              "restated": null,
              "pct": 74.3
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              "pct": 72.1
            }
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        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
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              "end": "2026-09-30",
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              "restated": null,
              "pct": -5.8
            },
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              "restated": null,
              "pct": -5.8
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              "restated": null,
              "pct": -14
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              "pct": -13.3
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              "filed": "2025-08-06",
              "restated": null,
              "pct": -17.4
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": -6
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "four_quarters_end": "2026-09-30",
          "value_musd": -5.9,
          "four_quarters_musd": -33.9
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "first_end": "2025-12-31",
          "value_musd": 12.5
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "first_end": "2025-12-31",
          "value_musd": 9.3
        },
        "free_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "first_end": "2025-12-31",
          "value_musd": 3.2
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "base_end": "2025-09-30",
          "pct": 2.5
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": 44.2
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": 104.8,
          "composition": "long-term debt plus other short-term borrowings"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": -60.5
        },
        "deferred_revenue": {
          "status": "not reported"
        },
        "backlog": {
          "status": "not reported"
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": 59.5
        },
        "inventory": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": 141.9
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-10-28",
          "value_musd": 339.4
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-27",
          "basis_filed": "2026-10-28",
          "value_musd": 844.7
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-27",
          "basis_filed": "2026-10-28",
          "value_musd": 905.2
        },
        "ev_sales": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-27",
          "basis_filed": "2026-10-28",
          "multiple": 3.4
        },
        "ev_ebit": {
          "status": "not meaningful"
        },
        "pe": {
          "status": "not meaningful"
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-27",
          "basis_filed": "2026-10-28",
          "multiple": 2.5
        },
        "fcf_yield": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-27",
          "basis_filed": "2026-10-28",
          "pct": 0.4
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 3.74,
      "days_to_cover": 4.8,
      "change_pct": 5.1
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 0,
          "sold_usd": 15582643.79,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 0,
          "sold_usd": 16586093.54,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\n\nOrthoPediatrics shares are more likely to lag the S&P 500 over the next three months because the price already sits above most analyst valuations after a strong quarter. The shares closed at $33.67 on 2026-11-11, above six of the seven price targets that brokers raised on 2026-10-28. Preliminary fourth-quarter revenue, expected around mid-January 2027, is the first hard test of whether sales justify that price.\n\nThe business is improving. Third-quarter revenue rose 19% to a record $72.7 million, and on 2026-10-27 the company raised its 2026 revenue guidance to $270.0–$273.0 million. At the Stifel 2026 Healthcare Conference on 2026-11-11, Chief Executive Dave Bailey said the company targets at least $6 million of fourth-quarter free cash flow and called the competitive field \"increasingly benign,\" according to Investing.com's account of the session.\n\nThe same session set limits on the fourth quarter. Management called it seasonally weaker than the third, cited a tough comparison against large prior-year 7D orders, and said it is limiting Latin American set sales to improve collections. Bailey said guidance would stay \"relatively conservative\" and gave no 2027 outlook. Stifel's moderator, Rick Wise, put fourth-quarter revenue near $69 million; management did not confirm the figure.\n\nThe rating is Low because the 34.6% three-month gain to the 2026-11-11 close prices in continued high-teens growth that management's own fourth-quarter commentary does not promise.\n\n## Bull Case\n- **Third-quarter growth was broad.** According to the company's 2026-10-27 release, revenue rose 19% to $72.7 million from $61.2 million, with US sales up 19% and international up 18%. Trauma & Deformity grew 19% to $52.6 million and Scoliosis 18% to $19.2 million; Bailey said on 2026-11-11 the quarter relied on no one-time sales.\n- **Full-year guidance moved up.** On 2026-10-27 the company raised 2026 revenue guidance to $270.0–$273.0 million from $265.0–$269.0 million. It kept its target of about $25 million in adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation, excluding one-off items).\n- **Cash flow is turning positive.** Third-quarter free cash flow was $1.6 million, against $3.4 million used a year earlier, and adjusted EBITDA was a record $6.9 million against $6.2 million, per the 2026-10-27 release. On 2026-11-11 management targeted at least $6 million of fourth-quarter free cash flow and breakeven for 2026.\n- **VerteGlide is already in 40-plus hospitals.** The company moved its VerteGlide Spinal Growth Guidance System for early onset scoliosis to full commercial release on 2026-11-09. At Stifel on 2026-11-11, Bailey said more than 40 hospitals were using it, with repeat use, and that it \"is going to be big for us next year.\"\n- **The next scoliosis product is close.** Bailey said on 2026-11-11 that an FDA investigational device exemption (IDE) for eLLi was expected \"at any moment,\" with first cases in early 2027. He said eLLi probably has a larger market than VerteGlide.\n- **Brokers raised targets together.** On 2026-10-28, according to Benzinga, Lake Street raised its target to $38; Canaccord Genuity, Piper Sandler and BTIG to $30; TD Cowen and Truist to $28; and Stifel to $27.\n\n## Bear Case\n- **The price sits above most targets.** The 2026-11-11 close of $33.67 is above six of the seven targets raised on 2026-10-28. Only Lake Street's $38 is higher, and Truist rates the shares Hold.\n- **The fourth quarter faces hard comparisons.** On the 2026-10-27 call, management said the quarter may not repeat prior-year one-off set sales to Brazil and large 7D orders. On 2026-11-11 it added that it is limiting Latin American set sales and cutting payment terms for stocking distributors.\n- **The largest holder sold during the climb.** SEC Form 4 filings show Squadron Capital LLC, a 10% owner, sold 336,831 shares at an average $23.04 from 2026-08-28 to 2026-09-01, 22,500 at $23.35 on 2026-09-02 and 302,369 at $21.01 on 2026-09-10. Jennifer Pritzker and director David Pelizzon filed matching reports for the same sales.\n- **The company still loses money.** The third-quarter net loss was $5.9 million, or $0.25 per share. Adjusted earnings per share of $(0.23) missed the $(0.21) estimate, according to Benzinga.\n- **Debt exceeds cash.** On 2026-09-30, cash, short-term investments and restricted cash totalled $44.9 million, down from $62.9 million at 2025-12-31, against a $48.6 million term loan and a $49.0 million convertible note.\n- **Inventory will absorb cash in 2027 and 2028.** Bailey said on 2026-11-11 that the company will reinvest part of its EBITDA growth into inventory over those two years and does not aim to maximise free cash flow.\n\n## Setup & Price Structure\nThe shares closed at $33.67 on 2026-11-11, 2.5% below the 52-week intraday high of $34.53 set on 2026-11-04. Since that day, closes have ranged from $31.76 on 2026-11-06 to $33.99 on 2026-11-09, so the price has stalled near its high after the post-earnings run.\n\nThe 3-month gain is 34.6%, measured from a $25.01 close on 2026-08-13. As of 2026-11-11, the 50-day moving average is $24.68 and the 200-day moving average is $20.13, both well below the price. The 52-week closing low is $14.64, set on 2026-04-29.\n\nThe analyst targets show where brokers valued the business after the report. Canaccord Genuity, Piper Sandler and BTIG are at $30 and Stifel is at $27, all below the 2026-11-11 close. Lake Street's $38 is the only published target above it.\n\n## Catalyst Calendar\n\n- **2026-12-02:** Piper Sandler 38th Annual Healthcare Conference fireside chat, 4:00 pm ET. This is the last scheduled management appearance before year-end; it shows whether the fourth-quarter framing, VerteGlide hospital count or eLLi timing has moved since 2026-11-11.\n- **~2027-01-15 (est.):** Preliminary fourth-quarter and full-year 2026 revenue. This is the first hard read on whether full-year sales land inside, below or above the $270.0–$273.0 million guidance against the Brazil and 7D comparisons.\n- **~2027-03-03 (est.):** Fourth-quarter 2026 report and 2027 guidance. It shows whether fourth-quarter free cash flow reached the $6 million target and whether 2027 guidance supports a price above most analyst targets.\n\n## What Would Change Our Mind\n\nA daily close above $36.70, beyond the 2026-11-04 intraday 52-week high of $34.53, would show the shares leading the S&P 500. Preliminary fourth-quarter revenue that lifts full-year 2026 sales above the $273.0 million top of guidance would also prove the call wrong.\n\n## Correlation Notes\nOrthoPediatrics trades with a small group of medtech and diagnostics names, including Enovis, Vericel, AxoGen and Glaukos. Its sales depend on pediatric procedure volumes, school-calendar seasonality and children's hospital contracting, so its own results drive the shares more than any shared theme. A broad sell-off in small-cap medtech would still likely pull the shares down with peers, whatever fourth-quarter sales turn out to be. Further sales by Squadron Capital, which reported three blocks between 2026-08-28 and 2026-09-10, would add supply that has nothing to do with the sector.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-12T04:08:18+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}