Investment Thesis
Brownie's Marine Group demonstrates modest profitability with a 4.5% net margin and positive free cash flow generation, but faces significant headwinds including near-flat revenue growth (+0.1% YoY) and weak liquidity metrics. The company's ability to sustain operations and fund growth is constrained by a quick ratio of 0.38x and minimal free cash flow margin of 1.0%, raising questions about operational resilience.
Strengths
- Positive profitability with 4.5% net margin and 14.6% ROE indicating reasonable earnings quality
- Strong interest coverage ratio of 10.9x and minimal leverage (0.03x debt/equity) providing financial stability
- Positive free cash flow of $61.8K demonstrates the business generates actual cash despite low margins
Risks
- Stagnant growth with only 0.1% YoY revenue increase suggests market saturation or competitive pressures in sporting goods sector
- Poor liquidity position with quick ratio of 0.38x indicates potential difficulty meeting short-term obligations without inventory liquidation
- Extremely thin operating margins (3.5%) and low FCF margin (1.0%) leave minimal room for error or unexpected expenses
Key Metrics to Watch
- Revenue growth trajectory and gross margin sustainability
- Operating cash flow trends and working capital management
- Quick ratio improvement and inventory turnover metrics
Financial Metrics
Revenue
6.1M
Net Income
277.6K
EPS (Diluted)
$0.00
Free Cash Flow
61.8K
Total Assets
5.6M
Cash
479.5K
Profitability Ratios
Gross Margin
38.4%
Operating Margin
3.5%
Net Margin
4.5%
ROE
14.6%
ROA
4.9%
FCF Margin
1.0%
Balance Sheet & Liquidity
Current Ratio
1.21x
Quick Ratio
0.38x
Debt/Equity
0.03x
Debt/Assets
66.2%
Interest Coverage
10.88x
Long-term Debt
60.0K
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: 2026-03-21T18:18:11.226802 |
Data as of: 2025-09-30 |
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