CONMED Corporation (CNMD): A Bull Case Theory 

We came across a bullish thesis on CONMED Corporation on DeepValue Capital’s Substack. In this article, we will summarize the bulls’ thesis on CNMD. CONMED Corporation’s share was trading at $46.00 as of September 26th. CNMD’s trailing P/E was 12.99 according to Yahoo Finance.

Conmed Corporation (CONMED) is a global medical device company focused on enabling less invasive and more effective surgery across orthopedics, general surgery, gastroenterology, gynecology, and thoracic procedures. Founded in 1970, Conmed expanded through acquisitions and internal R&D, with key milestones including the 1990s purchase of Linvatec, establishing a foothold in arthroscopy and sports medicine, and the 2019 acquisition of Buffalo Filter, positioning it as a leader in surgical smoke evacuation—a market boosted by robotic and minimally invasive surgery.

In 2024, Conmed generated roughly $1.3 billion in revenue, split between orthopedic surgery (~42%) and general surgery (~58%). The orthopedic segment includes implants, instruments, and extremity products, with 79% of revenue from single-use disposables, ensuring recurring demand. The general surgery business features high-margin, sticky products such as the AirSeal insufflation system and Buffalo Filter smoke evacuators, with over 92% of revenue from single-use items. About 45% of sales come from international markets.

Despite being down more than 70% from 2021 highs, Conmed’s fundamentals remain strong: revenue is up 30%, free cash flow up 50%, and returns on capital improved. Margin expansion has been significant, with management forecasting peak EPS in 2025, alongside $20 million in supply chain savings. Industry tailwinds support growth, though past supply chain disruptions temporarily impacted market share, particularly in orthopedics.

Execution will be critical for regaining lost share and sustaining margins, while potential recession and competitive pressures pose moderate risks. Conmed’s differentiated products, high recurring revenue, and recovery in supply chain efficiency create a compelling investment case. Assuming mid-single-digit growth, modest margin improvement, and a normalized FCF multiple, the company could more than double in value over the next three years, implying attractive upside from current levels and a potential ~27% CAGR.

Previously we covered a bullish thesis on Stryker Corporation (SYK) by The Antifragile Investor in January 2025, highlighting innovation-driven growth across MedSurg and Orthopaedics, the Mako robotic-arm platform, and strategic acquisitions. The company’s stock price has appreciated approximately by 2.22% since our coverage. The thesis still stands as Stryker’s innovation underpins long-term growth. DeepValue Capital shares a similar view but emphasizes Conmed’s supply chain recovery, high-margin surgical devices, and strong free cash flow.

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Disclosure: None.