Investment Thesis
Cannabist Co Holdings exhibits severe financial distress with negative stockholders' equity of -$151.7M, indicating liabilities exceed assets by a substantial margin. The company is burning cash with -$39.8M free cash flow while posting a -49.0% net margin on $253.7M revenue, demonstrating structural unprofitability that extends beyond operational challenges.
Strengths
- Revenue base of $253.7M indicates established market presence and customer demand
- Gross margin of 27.3% shows underlying product profitability at unit level
- Cash balance of $17.8M provides minimal runway for near-term operations
Risks
- Negative stockholders' equity of -$151.7M represents critical solvency risk and potential equity wipeout scenario
- Operating cash flow of -$35.7M combined with -$36.0M operating loss indicates unsustainable business model
- Current ratio of 0.89x and quick ratio of 0.48x demonstrate severe liquidity stress with insufficient current assets to cover short-term obligations
- Long-term debt of $299.3M with negative interest coverage of -1.1x indicates inability to service debt obligations
- Negative net margin of -49.0% means company loses $0.49 for every dollar of revenue generated
Key Metrics to Watch
- Path to operating profitability and timeline to positive operating cash flow
- Debt restructuring outcomes and refinancing options for $299.3M long-term debt
- Working capital trends and ability to maintain liquidity above current critical levels
Financial Metrics
Revenue
253.7M
Net Income
-124.3M
EPS (Diluted)
$-0.26
Free Cash Flow
-39.8M
Total Assets
536.5M
Cash
17.8M
Profitability Ratios
Gross Margin
27.3%
Operating Margin
-14.2%
Net Margin
-49.0%
ROE
N/A
ROA
-23.2%
FCF Margin
-15.7%
Balance Sheet & Liquidity
Current Ratio
0.89x
Quick Ratio
0.48x
Debt/Equity
N/A
Debt/Assets
128.5%
Interest Coverage
-1.12x
Long-term Debt
299.3M
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: 2026-03-22T00:22:10.818493 |
Data as of: 2025-09-30 |
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