Compass Diversified Holdings (CODI)
NYSE:CODI
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Compass Diversified Holdings
(NYSE:CODI)
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Rating:54Neutral
Price Target:
$12.50
▲(18.93% Upside)
Action:Reiterated
Date:05/09/26
The score is held back mainly by weak financial performance—ongoing losses and high leverage despite improved cash flow. Offsetting factors include constructive earnings-call guidance with tangible deleveraging progress and strong price momentum, though technicals look overbought and valuation remains constrained by negative earnings.
Positive Factors
Consumer segment strength
Durable consumer-brand momentum demonstrates product-market fit and pricing power. High growth and margin expansion at Honey Pot and steady gains at BOA reflect scalable, branded revenue streams that can consistently fund corporate deleveraging and re-investment over the next several quarters.
Negative Factors
Elevated overall leverage
High leverage materially constrains corporate flexibility and increases refinancing and interest-rate risk. With earnings still weak, leverage amplifies downside, limits capital-return options and raises sensitivity to slower cash flow or an adverse macro environment over the coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Consumer segment strength
Durable consumer-brand momentum demonstrates product-market fit and pricing power. High growth and margin expansion at Honey Pot and steady gains at BOA reflect scalable, branded revenue streams that can consistently fund corporate deleveraging and re-investment over the next several quarters.
Read all positive factors
Compass Diversified Holdings (CODI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$900.57M
Dividend Yield20.53%
Average Volume (3M)1.16M
Price to Earnings (P/E)―
Beta (1Y)1.55
Revenue Growth7.52%
EPS Growth-1.67%
CountryUS
Employees3,340
SectorIndustrials
Sector Strength72
IndustryConglomerates
Share Statistics
EPS (TTM)-3.81
Shares Outstanding75,235,970
10 Day Avg. Volume1,175,289
30 Day Avg. Volume1,164,603
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.82
Price to Sales (P/S)0.19
P/FCF Ratio-7.06
Enterprise Value/Market Cap3.00
Enterprise Value/Revenue1.46
Enterprise Value/Gross Profit3.34
Enterprise Value/Ebitda88.95
Forecast
1Y Price Target
$12.25Price Target Upside16.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)0.2
Revenue Forecast (FY)$1.76B
Compass Diversified Holdings Business Overview & Revenue Model
Company Description
Compass Diversified is a private equity firm specializing in add on acquisitions, buyouts, industry consolidation, recapitalization, late stage and middle market investments. It seeks to invest in niche industrial or branded consumer companies, ma...
How the Company Makes Money
CODI makes money primarily through the operating results of its majority-owned subsidiary businesses. Each subsidiary generates revenue by selling its own products and/or services to end customers (consumer/retail and e-commerce channels for brand...
Compass Diversified Holdings Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Positive
The call emphasized strong operational execution across several Consumer and select Industrial businesses (notably Honey Pot, BOA and Arnold), meaningful operating cash flow, a material divestiture and significant debt paydown. At the same time, key challenges remain — elevated overall leverage (~5x), Altor weakness, transitional costs at Rimports after the Sterno sale, ongoing Lugano-related legal and one-time expenses, and broader M&A and tariff uncertainty. Management provided constructive full-year guidance and a clear deleveraging plan with milestones toward returning capital, and they signaled further MSA review and potential additional divestitures.Positive Updates
Completed Sterno Food Service Sale and Large Debt Paydown
Closed sale of Sterno's food service business and repaid more than $280 million of senior secured term loan debt, reducing total leverage to approximately 5x and senior secured net leverage to below 1x.
Negative Updates
Leverage Remains Elevated
Despite the Sterno sale and >$280M debt repayment, total leverage remains around ~5x (was ~5.3x at quarter-end for covenant purposes) — well above long-term target of 3x–3.5x and the near-term milestone of getting below 4x.
Read all updates
Q1-2026 Updates
Positive
Negative
Completed Sterno Food Service Sale and Large Debt Paydown
Closed sale of Sterno's food service business and repaid more than $280 million of senior secured term loan debt, reducing total leverage to approximately 5x and senior secured net leverage to below 1x.
Read all positive updates
Company Guidance
CODI updated full‑year 2026 guidance to subsidiary adjusted EBITDA of $320–$365 million (Consumer $225–$260M; Industrial $95–$105M) — a range that reflects the sale of Sterno’s food‑service business and excludes other M&A — with 2026 CapEx modeled at $30–$40M and corporate cash management fees expected at $25–$30M; the company noted Q1 subsidiary adjusted EBITDA of $83.9M, Q1 operating cash flow of $23.9M, Q1 CapEx of $5.1M, ending cash of $65M with nearly full availability on a $100M revolver, GAAP Q1 revenues of $427M (down 5.9% YoY) and a GAAP net loss from continuing operations of $30.8M (improved ~$19M YoY), and said it has repaid more than $280M of senior secured term loan debt (reducing total leverage to ~5x and senior secured net leverage to below 1x); management cautioned the outlook excludes potential acquisitions/divestitures (other than the Sterno sale), does not quantify evolving tariff impacts, expects some stranded Sterno‑related costs in 2026 that should abate in 2027, and did not provide a GAAP reconciliation of full‑year subsidiary EBITDA due to unavailable reconciling information.Compass Diversified Holdings Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
20
Very Negative
Cash Flow
34
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.85B | 1.87B | 1.79B | 1.69B | 1.76B | 1.72B |
| Gross Profit | 807.72M | 721.24M | 750.42M | 674.72M | 649.43M | 661.58M |
| EBITDA | 30.36M | 16.16M | -69.49M | -73.03M | 81.59M | 193.13M |
| Net Income | -227.18M | -229.32M | -208.86M | 108.65M | -59.22M | 114.55M |
Balance Sheet | ||||||
| Total Assets | 2.96B | 3.04B | 3.30B | 3.33B | 3.49B | 3.14B |
| Cash, Cash Equivalents and Short-Term Investments | 60.75M | 68.02M | 59.66M | 446.62M | 52.67M | 160.73M |
| Total Debt | 1.86B | 1.88B | 3.53B | 3.33B | 1.83B | 1.28B |
| Total Liabilities | 2.43B | 2.47B | 2.77B | 2.47B | 2.56B | 1.86B |
| Stockholders Equity | 400.70M | 442.02M | 678.62M | 929.66M | 877.58M | 1.11B |
Cash Flow | ||||||
| Free Cash Flow | 10.11M | -51.15M | -124.34M | 22.30M | -106.83M | 94.17M |
| Operating Cash Flow | 46.43M | -6.83M | -67.64M | 78.08M | -46.65M | 134.05M |
| Investing Cash Flow | -23.46M | -48.03M | -422.45M | 570.50M | -626.72M | -317.50M |
| Financing Cash Flow | -105.96M | 60.50M | 100.61M | -260.16M | 575.24M | 273.21M |
Compass Diversified Holdings Technical Analysis
Positive
10.51
Price Trends
7.50
Positive
6.60
Positive
6.73
Positive
Market Momentum
1.03
Negative
80.36
Negative
90.01
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CODI, the sentiment is Positive. The current price of 10.51 is above the 20-day moving average (MA) of 8.54, above the 50-day MA of 7.50, and above the 200-day MA of 6.73, indicating a bullish trend. The MACD of 1.03 indicates Negative momentum. The RSI at 80.36 is Negative, neither overbought nor oversold. The STOCH value of 90.01 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CODI.
Compass Diversified Holdings Risk Analysis
Compass Diversified Holdings disclosed 50 risk factors in its most recent earnings report. Compass Diversified Holdings reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Compass Diversified Holdings Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $726.68M | 8.56 | 23.42% | 10.18% | -7.45% | ― | |
65 Neutral | $1.09B | -3.67 | 21.08% | 8.97% | 1.11% | 114.50% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
56 Neutral | $827.18M | -9.30 | 1.89% | 3.87% | -28.90% | ― | |
55 Neutral | $117.16M | -2.64 | -22.42% | ― | -3.08% | -9.56% | |
54 Neutral | $900.57M | -4.81 | -46.27% | 20.53% | 7.52% | -1.67% | |
52 Neutral | $547.10M | -1.28 | -41.74% | 1.90% | 72.20% | -267.01% |
* Industrials Sector Average
CODI
Compass Diversified Holdings
11.97
4.11
52.29%
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MATW
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NNBR
NN
2.22
0.02
0.91%
FIP
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Compass Diversified Holdings Corporate Events
Business Operations and StrategyM&A Transactions
Compass Diversified Advances Deleveraging With Sterno Unit Sale
Positive
May 5, 2026
Compass Diversified has completed the sale of the food service business of its majority-owned unit SternoCandleLamp Holdings to Archer Foodservice Partners, with the transaction closing on May 1, 2026, following a pre-closing distribution of Stern...
Dividends
Compass Diversified Declares Q1 2026 Preferred Cash Distributions
Positive
Apr 1, 2026
On April 1, 2026, Compass Diversified’s board declared first‑quarter 2026 cash distributions on all three of its preferred share series, continuing its practice of returning capital to income‑focused investors. For the period fro...
Business Operations and StrategyM&A Transactions
Compass Diversified to Sell Sterno Food Service Business
Positive
Mar 30, 2026
On March 28, 2026, Compass Diversified entered into a definitive agreement to sell the food service business of its majority-owned subsidiary SternoCandleLamp Holdings for an enterprise value of $292.5 million to Archer Foodservice Partners, a Wyn...
Business Operations and StrategyExecutive/Board Changes
Compass Diversified Expands Board With Two New Directors
Positive
Mar 3, 2026
Compass Diversified Holdings, an owner of middle-market branded businesses, reported board changes that took effect around the turn of March 2026, as it continues to use its permanent capital model to support subsidiary growth and long-term value ...
Business Operations and StrategyRegulatory Filings and Compliance
Compass Diversified Updates Management Services Agreement, Enhancing Governance
Positive
Feb 24, 2026
On February 23, 2026, Compass Group Diversified Holdings LLC and its external manager, Compass Group Management LLC, entered into an Eighth Amended and Restated Management Services Agreement, revising key terms of their management arrangement. The...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.