Investment Thesis
Dolphin Entertainment is fundamentally unprofitable with persistent negative operating margins (-16.7%) and negative free cash flow (-2.0M), indicating the core business is burning cash. While revenue growth of 9.7% YoY provides modest upside, the company faces immediate liquidity stress (current ratio 0.73x) and lacks a clear path to profitability, creating substantial equity risk.
Strengths
- Revenue growth of 9.7% YoY demonstrates market demand and business expansion
- Low leverage with debt-to-equity of 0.01x provides financial flexibility and limits bankruptcy risk from debt
- Gross margin of 23.4% suggests underlying product/service economics are viable
Risks
- Unprofitable operations with -2.1M operating loss and -2.7M net loss indicate structural business problems
- Negative operating cash flow of -2.0M confirms core business is burning cash unsustainably
- Current ratio of 0.73x signals acute liquidity stress with insufficient current assets to cover near-term liabilities
Key Metrics to Watch
- Operating margin trend - must demonstrate clear path to positive operating profitability within 2-3 quarters
- Operating cash flow - survival depends on turning negative FCF positive before cash depletion
- Cash balance depletion rate - with 6.3M cash and -2.0M annual burn, assess runway and need for capital raise
Financial Metrics
Revenue
12.8M
Net Income
-2.7M
EPS (Diluted)
$-0.22
Free Cash Flow
-2.0M
Total Assets
53.3M
Cash
6.3M
Profitability Ratios
Gross Margin
23.4%
Operating Margin
-16.7%
Net Margin
-21.0%
ROE
-36.8%
ROA
-5.1%
FCF Margin
-16.0%
Balance Sheet & Liquidity
Current Ratio
0.73x
Quick Ratio
0.73x
Debt/Equity
0.01x
Debt/Assets
86.3%
Interest Coverage
-3.90x
Long-term Debt
88.3K
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: 2026-05-14T08:11:14.650711 |
Data as of: 2026-03-31 |
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