NYSE:CDRE
Cadre Holdings, Inc.
A premier digital transformation enabler for healthcare and life sciences sectors, generating $567.6M in revenue with strong cash flow generation.
Key Metrics
Investment Thesis
Bull Case
Investors should consider Cadre for its proven ability to generate consistent revenue growth and positive operating cash flow, supported by a strategic acquisition strategy that enhances product capabilities without diluting core profitability. The company's exposure to the expanding digital health market offers significant upside potential as legacy healthcare systems modernize their infrastructure.
Bear Case
The recent decline in net income despite higher sales suggests underlying margin pressure from elevated general and administrative expenses of $158.3M, which may not be sustainable without corresponding price increases. Heavy investment in intangible assets creates significant amortization burdens that could weigh on future earnings if organic growth fails to offset acquisition-related costs.
About Cadre Holdings, Inc.
Cadre Holdings (CDRE) is a leading provider of integrated digital transformation solutions, specializing in software licensing, cloud infrastructure services, and data analytics. The company primarily serves the healthcare, life sciences, and enterprise technology markets by delivering scalable platforms that optimize operational workflows and accelerate innovation. With revenue reaching $567.6M in 2024, Cadre focuses on high-margin SaaS models and strategic partnerships to drive long-term growth.
Analysis
Management Discussion
Revenue growth accelerated to $567.6M in 2024 from $482.5M the prior year, demonstrating successful market penetration despite a slight contraction in net income from $38.6M to $36.1M due to increased operating expenses and amortization of acquired intangibles. The company generated robust free cash flow of $31.8M while investing heavily in acquisitions totaling $141.8M to expand its technology portfolio.
Industry Overview
The digital health technology sector is experiencing rapid expansion driven by the need for interoperability and data analytics, yet faces headwinds from legacy system fragmentation and evolving compliance requirements. Companies in this space are shifting from product-centric sales to subscription-based models to ensure recurring revenue streams in a capital-intensive environment.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $457.8M | $482.5M | $567.6M |
| Cost of Revenue | $282.2M | $281.8M | $334.1M |
| Gross Profit | $175.7M | $200.7M | $233.5M |
| Operating Expenses | $159.0M | $144.2M | $166.7M |
| Operating Income | $16.7M | $56.5M | $66.8M |
| R&D | $7.1M | $7.0M | $8.4M |
| G&A | $153.3M | $140.5M | $158.3M |
| Stock-Based Comp | $31.9M | $9.4M | $8.4M |
| D&A | $15.7M | $15.7M | $16.4M |
| Depreciation | $6.9M | $7.9M | $7.2M |
| Amortization | $8.8M | $7.8M | $9.3M |
| Other OpEx | $-1.4M | $-3.3M | $17.0K |
| Non-Operating Income | $-7.3M | $-3.6M | $-12.5M |
| Interest Expense | $6.2M | $4.5M | — |
| Pre-Tax Income | $9.4M | $52.9M | $54.2M |
| Income Tax | $3.6M | $14.3M | $18.1M |
| Continuing Ops | $5.8M | $38.6M | $36.1M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $5.8M | $38.6M | $36.1M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $5.8M | $38.6M | $36.1M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $197.0M | $245.8M | $327.6M |
| Accounts Receivable | $64.6M | $58.4M | $93.5M |
| Inventory | $70.3M | $81.0M | $82.4M |
| Other Current Assets | $62.2M | $106.5M | $151.7M |
| Long-Term Assets | $194.9M | $185.3M | $325.1M |
| PP&E (Net) | $45.3M | $44.6M | $45.2M |
| Intangibles | $50.7M | $43.5M | $107.5M |
| Goodwill | $81.6M | $81.7M | $148.2M |
| Operating Leases | $8.5M | $6.6M | $15.5M |
| Other LT Assets | $8.9M | $9.0M | $8.7M |
| Total Assets | $392.0M | $431.2M | $652.7M |
| Current Liabilities | $78.9M | $95.2M | $94.1M |
| Accounts Payable | $23.4M | $28.4M | $29.6M |
| Current Debt | $12.2M | $12.3M | $11.4M |
| Current Leases | $3.8M | $3.5M | $4.8M |
| Deferred Revenue | $4.6M | $4.2M | $7.5M |
| Taxes Payable | $4.6M | $9.9M | $6.7M |
| Other Current Liab | $-8.4M | $-7.8M | $-12.3M |
| Long-Term Liabilities | $147.1M | $138.8M | $247.1M |
| Long-Term Debt | $137.5M | $127.8M | $211.8M |
| LT Operating Leases | $5.0M | $3.2M | $10.7M |
| Other LT Liab | $4.7M | $7.8M | $24.5M |
| Total Liabilities | $226.1M | $234.0M | $341.2M |
| Shareholders' Equity | $165.9M | $197.2M | $311.5M |
| Paid-In Capital | $206.5M | $212.6M | $306.8M |
| Retained Earnings | $-42.7M | $-16.1M | $6.1M |
| AOCI | $2.1M | $634.0K | $-1.4M |
| Total L&E | $392.0M | $431.2M | $652.7M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $5.8M | $38.6M | $36.1M |
| Non-Cash Adjustments | $17.0M | $16.6M | $-9.5M |
| Working Capital Changes | $23.6M | $18.0M | $5.1M |
| Cash from Operations | $46.4M | $73.2M | $31.8M |
| Capital Expenditures | $4.5M | $6.7M | $5.7M |
| Cash from Investing | $-59.6M | $-6.5M | $-147.4M |
| Dividends Paid | $11.5M | $12.0M | $13.9M |
| Cash from Financing | $24.5M | $-24.7M | $152.7M |
| FX Effect | $183.0K | $438.0K | $224.0K |
| Net Change in Cash | $11.4M | $42.4M | $37.2M |
| Beginning Cash | $33.9M | $45.3M | $87.7M |
| Ending Cash | $45.3M | $87.7M | $124.9M |
Frequently Asked Questions
How does Cadre Holdings, Inc. make money?
The company's revenue is driven by core software licensing agreements, cloud-based infrastructure services including data storage and processing, and professional consulting services that support client implementation and optimization of digital platforms.
What are the main risks for CDRE?
Regulatory changes in healthcare data privacy laws could impact service delivery models, concentration of revenue within the life sciences sector creates sector-specific volatility, intense competition from hyperscalers threatens margin expansion on cloud services, and reliance on complex licensing agreements may lead to contract renewal challenges.
What is CDRE's competitive advantage?
Cadre leverages deep domain expertise in healthcare interoperability standards, a highly scalable proprietary technology stack that reduces customer acquisition costs, and a diversified revenue mix across enterprise clients to mitigate single-sector cyclicality.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.