In this segment of "Industry Focus" on Motley Fool Live, recorded on Dec. 15, Fool Tech Host Dylan Lewis and Analyst Yasser El-Shimy outline some areas of concern for BICO's (BICO) operating cash flow. 

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Dylan Lewis: One thing that jumped out to me when I was looking at the business is you did a great job laying out the margins for the company and how it compares to some other players in the industry.

For a company that is seeing scale and leverage, we're actually seeing margin contraction, which I was a little bit surprised by.

Yasser El-Shimy: Yeah. Again, they explain that margin contraction in the last quarter due to tough comps to those onetime hygienic products that they sold in 2020. But there have been other actually, I would say potentially more discouraging signs related to their cash flow from operations.

They have been really hammered by supply chain disruptions, delivery cost increases, intermittent lockdowns, especially in Europe. We can clearly see that in the operating cash flow declining by nearly 10X in the first three quarters of 2021, compared to last year, as deliveries took much longer to execute leading to rising inventories, sale cycle getting elongated, cost of goods sold also increasing due to inflationary pressures on raw materials.

In other words, everything is becoming more expensive and they are feeling that as a company that does sell hardware items, it's not a software business primarily. That can be understood, but we would still like to see this improving over time as they come through this tough period of supply chain disruption and inflation.