Investment Thesis
Champions Oncology shows concerning financial deterioration with negative operating cash flow of -2.5M and free cash flow of -2.8M despite 13.5% revenue growth, indicating the company is burning cash and unable to convert sales into profits. The company is unprofitable with a -1.1% net margin and negative ROE of -11.9%, while maintaining a precarious liquidity position with a current ratio of 0.98x that leaves minimal margin for error.
Strengths
- Revenue growth of 13.5% YoY demonstrates demand for services
- Cash position of 7.1M provides near-term operational runway
- Low debt burden with 0.00x debt-to-equity ratio reduces financial risk
Risks
- Negative operating cash flow of -2.5M indicates unsustainable cash burn despite positive revenue growth
- Current ratio of 0.98x signals liquidity pressure with current liabilities exceeding current assets
- Persistent unprofitability with operating margin of -1.4% and net margin of -1.1% raises questions about business model viability
- Free cash flow margin of -6.1% shows company is consuming capital to generate each dollar of revenue
- Stockholders' equity of only 4.3M on total assets of 28.4M indicates thin equity cushion relative to liabilities
Key Metrics to Watch
- Operating cash flow trend and path to positive FCF generation
- Gross margin expansion and operating leverage as revenue scales
- Current ratio maintenance above 1.0x to ensure adequate liquidity
- Net income improvement trajectory and timeline to sustained profitability
Financial Metrics
Revenue
45.6M
Net Income
-508.0K
EPS (Diluted)
$-0.04
Free Cash Flow
-2.8M
Total Assets
28.4M
Cash
7.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
-1.4%
Net Margin
-1.1%
ROE
-11.9%
ROA
-1.8%
FCF Margin
-6.1%
Balance Sheet & Liquidity
Current Ratio
0.98x
Quick Ratio
0.98x
Debt/Equity
0.00x
Debt/Assets
84.6%
Interest Coverage
N/A
Long-term Debt
N/A
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: 2026-03-23T01:42:11.304190 |
Data as of: 2026-01-31 |
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