MeritValue

Compass Diversified Holdings

CODIdata completeness 100%17 fiscal years on file
The thesis, from the filings

Compass Diversified Holdings earns about -1% on invested capital, but has diluted owners by 15% over 5 years — worth asking whether the growth reaches owners. The cash-flow models don't apply cleanly here — the ledger says why below.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.72B1$1.76B2$1.69B3$1.79B3$1.87B3
Net income$114.6M4−$59.2M5$108.6M6−$208.9M6−$226.4M6
Operating cash flow$134.1M7−$46.6M8$16.6M9−$151.1M9−$6.83M9
Capital expenditure$33.1M10$60.2M11$55M12$56.7M12$44.3M12
Free cash flow (derived)$100.9M7−$106.8M8−$38.4M9−$207.8M9−$51.1M9
Total debt$2.57B13$3.68B14$5.02B14$5.32B15$3.79B15
Cash & equivalents$160.7M16$52.7M17$446.6M17$59.7M18$68M18
Diluted shares65.4M70.7M72.1M75.5M75.2M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$58.75
your share of equity
Profit it earned you last year
−$30.09
Free cash flow it threw off
−$6.8
Debt you’d be carrying
$504.03

10 shares is a claim on $58.75 of net worth that earned you −$30.09 and generated −$6.8 of cash last year, against $504.03 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
-1% avg · 5y
FY21 1%FY22 -1%FY23 -2%FY24 -2%FY25 -2%

It earned an average -1% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+15% shares · 5y

Share count is up 15% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 48% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
not applicable
normalized (5y-median) earnings non-positive — EPV undefined
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001345126-24-000016 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001345126-26-000026 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001345126-24-000016 (NetIncomeLoss)
  5. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001345126-26-000026 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001345126-24-000016 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001345126-26-000026 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001345126-24-000016 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001345126-26-000026 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001345126-23-000020 (LongTermDebtNoncurrent)
  14. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2024-12-31 · accession 0001345126-26-000026 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2021-12-31 · accession 0001345126-23-000020 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K/A · period ending 2022-12-31 · accession 0001345126-25-000078 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2024-12-31 · accession 0001345126-26-000026 (CashAndCashEquivalentsAtCarryingValue)