Investment Thesis
Ameresco exhibits exceptional revenue growth (+2622% YoY) suggesting major contract wins or acquisitions, but fundamental profitability is severely impaired with negative net income and critically inadequate interest coverage (0.4x). While positive operating cash flow provides near-term relief, the company cannot service $1.8B debt from operations, creating refinancing risk and indicating execution challenges despite massive top-line growth.
Strengths
- Exceptional revenue growth of +2622% YoY indicates significant business expansion and market traction
- Positive operating and free cash flow of $35.4M and $34.9M respectively despite net losses, suggesting underlying business viability
- Adequate short-term liquidity with current ratio of 1.49x and quick ratio of 1.48x
Risks
- Interest coverage ratio of 0.4x is critically inadequate; operating income cannot service debt obligations, creating refinancing risk
- Negative net income of -$18.3M and net margin of -4.6% despite massive revenue growth indicates profitability issues from acquisitions or contract integration challenges
- High leverage with debt-to-equity of 1.71x and $1.8B long-term debt relative to $1.1B stockholders equity limits financial flexibility and increases financial distress risk
Key Metrics to Watch
- Interest coverage ratio - must improve to above 1.0x to demonstrate debt serviceability from operations
- Net profit margin trajectory - need evidence of profitability inflection as revenue growth stabilizes
- Operating cash flow sustainability - verify positive FCF continues and doesn't deteriorate with revenue normalization
Financial Metrics
Revenue
401.5M
Net Income
-18.3M
EPS (Diluted)
$-0.35
Free Cash Flow
34.9M
Total Assets
4.6B
Cash
104.0M
Profitability Ratios
Gross Margin
14.1%
Operating Margin
2.6%
Net Margin
-4.6%
ROE
-1.7%
ROA
-0.4%
FCF Margin
8.7%
Balance Sheet & Liquidity
Current Ratio
1.49x
Quick Ratio
1.48x
Debt/Equity
1.71x
Debt/Assets
5.6%
Interest Coverage
0.38x
Long-term Debt
1.8B
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: 2026-05-06T20:01:07.396417 |
Data as of: 2026-03-31 |
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