Compass Diversified Stock Price, News & Analysis

Compass Diversified (NYSE: CODI) is a U.S.-based holding company that owns and manages a portfolio of middle-market businesses across branded consumer and industrial sectors. According to company disclosures, it organizes its activities into branded consumer businesses, which capitalize on valuable brand names in their respective market sectors, and industrial businesses, which focus on manufacturing and selling specific products and industrial services within defined market niches. Shares representing beneficial interests in Compass Diversified Holdings, as well as multiple series of preferred shares, are listed on the New York Stock Exchange under the symbols CODI, CODI PR A, CODI PR B and CODI PR C.

Compass Diversified describes itself as an owner of leading middle-market businesses. Its branded consumer group includes companies such as 5.11, Ergobaby, Liberty Safe, and Velocity Outdoor, while its industrial group is oriented around manufacturing and industrial services. The company has stated that it has operations in the United States, Canada, Europe, the Asia Pacific region and other international areas. Through this structure, CODI seeks to manage and grow high-quality middle-market companies and to generate long-term value for its stakeholders by partnering with subsidiary management teams.

Business model and portfolio approach

CODI’s business model is built around acquiring, owning and actively overseeing controlling interests in middle-market companies. In public communications, the company emphasizes working closely with subsidiary management to drive performance, invest for growth and enhance profitability. CODI highlights the cash flow generation of its operating subsidiaries (excluding its Lugano subsidiary) and uses non-GAAP measures such as Adjusted EBITDA and Adjusted Earnings (Loss) to evaluate performance across its portfolio. These measures are reconciled to GAAP metrics like Net Income (Loss) and Income (Loss) from Continuing Operations in its financial reports.

The company also uses pro forma net sales in certain contexts, for example to illustrate the impact of acquisitions such as The Honey Pot Co. on sales trends. Pro forma net sales are defined by CODI as net sales including historical net sales relating to pre-acquisition periods of an acquired company, and are reconciled to reported net sales in its filings and press releases. CODI explains that these non-GAAP measures are intended to provide additional insight into operating results and to support evaluation of potential acquisition targets.

Capital structure, credit facilities and preferred shares

Compass Diversified finances its activities through a combination of common equity, preferred equity and debt under a syndicated credit agreement. The company has multiple series of preferred shares—Series A, Series B and Series C—on which its Board of Directors declares quarterly cash distributions. Public announcements detail the distribution rates, record dates and payment dates for these preferred series, and CODI notes that such distributions may qualify as "qualified dividends" for U.S. federal income tax purposes to the extent they are paid from earnings and profits, subject to applicable tax rules.

CODI is party to a Third Amended and Restated Credit Agreement with a group of senior secured lenders. In December 2025, the company entered into a Fifth Amendment to its Credit Agreement and Limited Waiver Agreement, which, among other items, restored full access to a $100 million revolving credit facility, adjusted interest rate margins based on leverage ratios, revised financial covenants, and imposed certain restrictions on management fees and restricted payments. The amendment also addressed waivers of prior events of default, many of which were associated with its Lugano subsidiary and related leverage metrics, and established requirements for regular cash flow forecasts and reporting to the administrative agent.

Regulatory status and listing

Compass Diversified’s securities are registered under the Securities Exchange Act of 1934, and the company files periodic reports, including Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, with the U.S. Securities and Exchange Commission (SEC). An 8-K filing dated January 6, 2026 discloses that CODI received a notice from the New York Stock Exchange indicating non-compliance with certain corporate governance listing standards related to the requirement to hold an annual meeting during each fiscal year. CODI has stated that it intends to hold an annual meeting as soon as practicable to regain compliance, and subsequent disclosure notes that its 2026 annual meeting of shareholders is scheduled for May 21, 2026.

The company has also reported that, following the filing of its Amendment No. 1 to its Annual Report on Form 10-K/A for the fiscal year ended December 31, 2024, its lenders agreed that the restated financial statements satisfied the requirements of the Credit Agreement and related forbearance arrangements. CODI has emphasized its goal of being current with SEC reporting requirements and maintaining compliance with its credit facilities and bond indentures.

Lugano subsidiary, restatement and Chapter 11 process

A significant recent development for Compass Diversified involves its former subsidiary Lugano Holding, Inc. The company has disclosed that an investigation into financial and accounting irregularities at Lugano revealed pervasive and complex fraud that was isolated to that subsidiary. As a result, CODI undertook an extensive restatement of previously issued financial statements for multiple fiscal years, including adjustments to accounts receivable, inventory, other current assets, goodwill, intangible assets, accrued expenses, financing arrangements and noncontrolling interest related to Lugano.

In November 2025, CODI announced that Lugano filed for Chapter 11 protection under the U.S. Bankruptcy Code. CODI, as Lugano’s senior secured lender, agreed to provide debtor-in-possession financing to support the bankruptcy process. The company has stated that Lugano will no longer be consolidated with CODI’s financial results starting in the fourth quarter of 2025. CODI’s public statements emphasize that the Lugano issues and related restatement are isolated to that subsidiary and do not involve its other eight subsidiaries, which it describes as continuing to perform well and generate cash flow.

Financial reporting, non-GAAP measures and risk factors

Compass Diversified’s financial communications include detailed consolidated balance sheets and statements of operations, along with reconciliations from GAAP results to non-GAAP measures. The company explains that Adjusted EBITDA and Adjusted Earnings (Loss) are used internally to assess performance because they exclude certain items that reflect long-term investment decisions, non-cash charges such as impairments, and specific cash charges. CODI notes the limitations of these non-GAAP measures, including that they do not reflect periodic costs of capital assets or certain non-cash and cash charges, and that they may differ from similarly titled measures used by other companies.

Forward-looking statements in CODI’s disclosures identify numerous risk factors that could affect results, including changes in the economy, financial markets and political environment; inflation and interest rate trends; U.S. tariff and trade regulations; supply chain disruptions; labor availability and costs; environmental risks affecting subsidiaries; the ability to complete and integrate acquisitions or execute divestitures; the performance of subsidiaries; cash resources and working capital; compliance with NYSE listing standards; cooperation from lenders; and litigation and regulatory actions related to the Lugano investigation and internal control matters. CODI refers investors to its Form 10-K/A and related SEC filings for a more detailed discussion of these risks.

Geographic reach and sector classification

According to prior company descriptions, Compass Diversified has operations in the United States, Canada, Europe, the Asia Pacific region and other international areas. While the NAICS industry classification provided here is Upholstered Household Furniture Manufacturing, CODI’s own disclosures describe a broader scope that spans branded consumer and industrial businesses rather than a single manufacturing category. Its portfolio companies operate in distinct market sectors, and CODI’s role is to own, manage and support these middle-market businesses.

Investor considerations for CODI stock

Investors evaluating CODI stock can review the company’s SEC filings, including its restated financial statements, quarterly reports and numerous Form 8-K filings that describe material events such as amendments to its credit agreement, forbearance arrangements with lenders, Chapter 11 proceedings for Lugano, preferred share distributions and NYSE compliance matters. CODI’s use of non-GAAP measures, its focus on cash flow generation at subsidiaries, and its active management of leverage and capital structure are recurring themes in its public communications. As with any investment, analysis of CODI involves understanding its portfolio companies, financial reporting history, credit agreements and the risks identified in its regulatory filings.