Investment Thesis
Authentic Holdings demonstrates severe operational distress with negative operating margins of -197% and net margins of -310%, indicating the company is burning cash on every dollar of revenue. The balance sheet shows critically low liquidity (0.02x current ratio) with only $7K in cash against $6.4M in liabilities, creating an imminent solvency crisis with no evident path to profitability.
Strengths
- Strong gross margin of 70.4% suggests viable unit economics at the product level
- Moderate debt-to-equity ratio of 0.07x indicates relatively low leverage compared to equity base
- Positive stockholders' equity of $4.5M provides some asset backing
Risks
- Critically low liquidity (0.02x current ratio) with only $7K cash against current obligations, indicating immediate solvency concerns
- Severe cash burn with negative operating cash flow of -$10.4K and free cash flow margin of -3.0%
- Massive operating losses of -$687.5K on revenue of only $348.9K, demonstrating unsustainable business model
- Negative ROE of -23.9% and ROA of -9.9% indicate value destruction for both equity holders and asset base
- No insider buying activity in last 90 days suggests lack of management confidence
Key Metrics to Watch
- Operating cash flow trend and path to cash flow breakeven
- Cash balance depletion rate and runway until capital crisis
- Revenue growth and ability to achieve operating leverage
- Operating margin improvement toward positive territory
Financial Metrics
Revenue
348.9K
Net Income
-1.1M
EPS (Diluted)
$0.00
Free Cash Flow
-10.4K
Total Assets
10.9M
Cash
7.0
Profitability Ratios
Gross Margin
70.4%
Operating Margin
-197.0%
Net Margin
-310.0%
ROE
-23.9%
ROA
-9.9%
FCF Margin
-3.0%
Balance Sheet & Liquidity
Current Ratio
0.02x
Quick Ratio
0.02x
Debt/Equity
0.07x
Debt/Assets
58.6%
Interest Coverage
N/A
Long-term Debt
319.2K
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-03-19T17:41:21.184999 |
Data as of: 2025-09-30 |
Powered by Claude AI