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Pro-Dex Is Growing But Expensive Given Its Risk

Jan. 30, 2023 3:24 AM ETPro-Dex, Inc. (PDEX)
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Quipus Capital


  • Pro-Dex is a contract manufacturer with a significant customer and product concentration on a single line of medical battery-powered drivers.
  • The company has recently leveraged operationally and financially by taking debt to build a new factory that should begin operations this year.
  • Although revenues and profits have grown for much of the past decade, I am not comfortable with the multiples the company trades at currently.
  • Above all, the risk of customer concentration leveraged at the operational and financial levels is too high.

Macho y hembra de los trabajadores en el centro de distribución

eclipse_images/E+ via Getty Images

Pro-Dex (NASDAQ:PDEX) is a designer and manufacturer of battery powered surgical drivers located in California. The company has done contract manufacturing of other powered medical and dental products in the past as well.

Although PDEX has

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