Quality Investor

Varex Imaging Corporation

Rank #261Decline

VREX · Nasdaq · Healthcare

Varex Imaging Corporation (VREX) — Rank #261 by gross profitability (GP/assets 0.26) · ROE -14.2% · Piotroski F-Score 6 / 9.

As-of 2026-09-15 · CIK 0001681622 · all metrics point-in-time as of the filing date.

About

Varex Imaging Corporation designs, manufactures, and sells X-ray imaging components.

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It operates through two segments, Medical and Industrial. The Medical segment designs, manufactures, sells, and services X-ray imaging components, comprising X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, collimators, automatic exposure control devices, generators, and heat exchangers. This segment's products are used in a range of applications, including CT, mammography, oncology, cardiac, surgery, dental, and other diagnostic radiography uses. The Industrial segment designs, develops, manufactures, sells, and services Linatron X-ray linear accelerators, non-intrusive cargo inspection systems, X-ray tubes, digital detectors, high voltage connectors, and coolers for use in security and inspection applications, such as baggage screening at airports, cargo screening at ports and borders, and nondestructive testing, irradiation, and inspection in various applications. It sells its products through imaging system original equipment manufacturers, independent service companies, and distributors, as well as directly to end-users. The company has operations in North America, Latin America, Europe, the Middle East, India, Africa, Asia, and Australia.

The company was incorporated in 2016 and is headquartered in Salt Lake City, Utah.

Industry
Medical Devices
Sector
Healthcare
State
DE
Filer Category
Accelerated filer
Fiscal Year End
October 2

Price History

VREX-37.0% · -8.8% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/E, P/B, and dividend yield matter most — book value provides a floor.

Market Cap

$779.32M

P/E (annual)

P/S (annual)

0.9

P/B

1.6

P/OCF (annual)

18.7

Shareholder Yield

17.7%

Employees

2,500

Industry

Medical Devices

Exchange

Nasdaq

Signal Flags

1 green1 yellow2 red
Sequential beat (rev + EPS)Both revenue and EPS exceeded prior quarter — 1-quarter streak
Disclosure regressionA previously-disclosed line item is no longer reported — worth checking the filing for why
Revenue declining YoYRevenue contracted year over year
Operating margin decliningOperating margin lower than prior year

Quality Profile

Profitability

1/1 pass
GP / assets
0.26
Return on equity
-14.2%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.15
Current ratio
3.38×
Net cash
-$247.90M

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
1.8%

Growth

1/2 pass
Revenue growth
-5.5%
Piotroski F-Score
6 / 9
Share dilution
-17.7%

Terry Smith quality gate

Passes 0/5 Terry Smith thresholds

2 of 5 thresholds not computable from filed data.

What Growth Is Priced In

Implied revenue growth (10Y)

17.4%

fairly valued

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Buyback tailwind: -17.7% — per-share value needs a total required return of -0.3% once share-count change is priced in.

vs. own 6-year median revenue growth: 2.4%

priced above its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

12.5%

r = 10% (base)

17.4%

r = 12%

21.6%

Net debt / market cap: 32.4%— material leverage inflates the implied growth read.

Base FCF: $18.8M

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

N/A
17.3xmed 29.2x73.3x

P / S

Price / revenue per share

0.7xCheap
0.7xmed 1.3x2.4x

P / B

Price / book value per share

1.1xCheap
1.1xmed 2.3x3.9x

P / GP

Price / gross profit per share

2.3xCheap
2.3xmed 4.1x5.9x

P / FCF

Price / free cash flow per share

29.1xExpensive
10.7xmed 27.3x78.5x

Asset value and restructuring potential (balance-sheet strength) are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.26

Primary signal (Novy-Marx).

43rd pctl of 43 SIC 36 peers

Return on equity

-14.2%

Gross margin

34.4%

12th pctl of 43 SIC 36 peers

Revenue growth (YoY)

-5.5%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2021202220232024
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.15

20th pctl of 41 SIC 36 peers (best = lowest)

Current ratio

3.38×

67th pctl of 43 SIC 36 peers

Quick ratio

1.30×

Net cash

-$247.90M

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$18.80M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

1.27

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

1.8%

Stock-based comp intensity.

Piotroski F-Score

F-Score

6 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20192024
Value
Decline
Op. Leverage