Medical products company UFP Technologies (NASDAQ: UFPT) met Wall Street’s revenue expectations in Q4 CY2025, with sales up 3.4% year on year to $148.9 million. Its non-GAAP profit of $2.44 per share was 9.2% above analysts’ consensus estimates.

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“I am pleased with our 2025 results and our progress on a number of key strategic initiatives,” said R. Jeffrey Bailly, CEO.

Company Overview

With expertise dating back to 1963 in specialized materials and precision manufacturing, UFP Technologies (NASDAQ: UFPT) designs and manufactures custom solutions for medical devices, sterile packaging, and other highly engineered products for healthcare and industrial applications.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, UFP Technologies grew its sales at an exceptional 27.4% compounded annual growth rate. Its growth beat the average healthcare company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. UFP Technologies’s annualized revenue growth of 22.7% over the last two years is below its five-year trend, but we still think the results suggest healthy demand.

This quarter, UFP Technologies grew its revenue by 3.4% year on year, and its $148.9 million of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 5.5% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is above average for the sector and suggests the market sees some success for its newer products and services.

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Operating Margin

UFP Technologies has done a decent job managing its cost base over the last five years. The company has produced an average operating margin of 14.8%, higher than the broader healthcare sector.

Analyzing the trend in its profitability, UFP Technologies’s operating margin rose by 5 percentage points over the last five years, as its sales growth gave it operating leverage.

This quarter, UFP Technologies generated an operating margin profit margin of 14.4%, down 1.8 percentage points year on year. This reduction is quite minuscule and indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

UFP Technologies’s EPS grew at an astounding 39.9% compounded annual growth rate over the last five years, higher than its 27.4% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into UFP Technologies’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, UFP Technologies’s operating margin declined this quarter but expanded by 5 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q4, UFP Technologies reported adjusted EPS of $2.44, down from $2.46 in the same quarter last year. Despite falling year on year, this print beat analysts’ estimates by 9.2%. Over the next 12 months, Wall Street expects UFP Technologies’s full-year EPS of $9.80 to grow 7.6%.

Key Takeaways from UFP Technologies’s Q4 Results

It was good to see UFP Technologies beat analysts’ EPS expectations this quarter. Overall, this print had some key positives. Investors were likely hoping for more, and shares traded down 4.5% to $229.03 immediately following the results.

So should you invest in UFP Technologies right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).