Investment Thesis
Amrize is experiencing severe financial distress with persistent operating losses (-3.5% margin), unsustainable negative free cash flow of -$1.2B annually, and inability to cover interest expenses (coverage ratio: -1.1x). The company's thin gross margins (9.7%), stagnant revenue growth (0.9%), and high cash burn rate make near-term insolvency risk substantial, particularly given $4.9B in debt against only $1.1B cash reserves that will be depleted within one year at current burn rates.
Strengths
- Moderate leverage at 0.38x Debt/Equity ratio, not over-leveraged
- Solid asset base of $24.3B provides some liquidation value cushion
- Adequate current ratio of 1.40x indicates near-term liquidity available for obligations
Risks
- Severe cash burn with -$1.2B free cash flow annually exhausting $1.1B cash reserves within ~1 year
- Negative interest coverage ratio (-1.1x) means company cannot service $4.9B debt from operations, requiring refinancing in deteriorating credit environment
- Persistent unprofitability across all metrics (operating margin -3.5%, net margin -5.3%, ROE -0.9%) with no visible profitability path despite flat revenue growth of 0.9%
- Critical liquidity squeeze evidenced by quick ratio of 0.89x below 1.0x threshold
Key Metrics to Watch
- Operating cash flow trend - must return to positive to avoid insolvency
- Cash balance depletion rate relative to quarterly burn and debt maturity schedule
- Gross margin sustainability - at 9.7%, any revenue decline would worsen losses further
Financial Metrics
Revenue
2.2B
Net Income
-116.0M
EPS (Diluted)
$-0.21
Free Cash Flow
-1.2B
Total Assets
24.3B
Cash
1.1B
Profitability Ratios
Gross Margin
9.7%
Operating Margin
-3.5%
Net Margin
-5.3%
ROE
-0.9%
ROA
-0.5%
FCF Margin
-53.6%
Balance Sheet & Liquidity
Current Ratio
1.40x
Quick Ratio
0.89x
Debt/Equity
0.38x
Debt/Assets
46.1%
Interest Coverage
-1.06x
Long-term Debt
4.9B
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: 2026-05-08T07:11:47.478733 |
Data as of: 2026-03-31 |
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