Investment Thesis
Astrana demonstrates strong revenue growth of 56.4% YoY, but faces severe operational challenges with near-zero gross margins (0.1%) and net income declining 51.8% despite scaling revenues—a sign of deteriorating unit economics. High leverage (1.22x D/E) combined with weak interest coverage (1.8x) and profitability margins of just 1.5% create financial vulnerability if operational performance does not substantially improve.
Strengths
- Exceptional top-line growth of 56.4% YoY showing strong market demand
- Positive free cash flow of $64.1M and solid cash position of $478.4M provides financial cushion
- Operating cash flow remains healthy at $68.1M despite net income deterioration
Risks
- Gross margin of 0.1% is critically low and unsustainable; cost structure severely misaligned with revenue
- Net income declining 51.8% while revenue grows 56.4% indicates accelerating margin compression and poor scalability
- Interest coverage ratio of only 1.8x combined with 1.22x debt-to-equity leverage leaves minimal buffer for operational decline
Key Metrics to Watch
- Gross margin trajectory and cost of services improvements
- Operating margin sustainability amid continued revenue scaling
- Debt service coverage and debt reduction pace relative to operating cash flow
Financial Metrics
Revenue
965.1M
Net Income
14.4M
EPS (Diluted)
$0.29
Free Cash Flow
64.1M
Total Assets
2.4B
Cash
478.4M
Profitability Ratios
Gross Margin
0.1%
Operating Margin
3.0%
Net Margin
1.5%
ROE
1.8%
ROA
0.6%
FCF Margin
6.6%
Balance Sheet & Liquidity
Current Ratio
1.35x
Quick Ratio
1.35x
Debt/Equity
1.22x
Debt/Assets
75.5%
Interest Coverage
1.76x
Long-term Debt
979.8M
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: 2026-05-09T09:36:45.921183 |
Data as of: 2026-03-31 |
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