Investment Thesis
DSG Global is in severe financial distress with negative stockholders equity of -$12.3M, indicating liabilities exceed assets by a substantial margin. The company is burning cash at an alarming rate with negative operating cash flow of -$835.2K and negative free cash flow of -$844.1K, while generating minimal revenue of $1.3M against massive operating losses of -$1.8M. With a critically weak current ratio of 0.16x, insufficient cash reserves of only $19.5K, and no clear path to profitability, the company faces imminent financial distress or insolvency.
Strengths
- Gross margin of 58.5% suggests underlying service delivery economics are viable if revenue scales
- No insider selling activity in last 90 days
- Still generating positive gross profit of $770.1K from revenue base
Risks
- Negative stockholders equity of -$12.3M indicates balance sheet insolvency and equity wipeout risk
- Critical liquidity crisis with current ratio of 0.16x and only $19.5K cash against $11.1M liabilities
- Massive operating losses with -133.4% operating margin and -216.5% net margin; company loses $2.16 for every $1 of revenue
- Negative operating cash flow of -$835.2K indicates core business cannot support itself operationally
- Revenue base of only $1.3M is insufficient to service $2.4M long-term debt or cover ongoing operating expenses
- No clear revenue growth trajectory or viable turnaround plan evident from financials
Key Metrics to Watch
- Cash burn rate and remaining cash runway (currently ~0.02 months at current burn)
- Revenue growth and ability to achieve break-even operations
- Total liabilities reduction and stockholders equity recovery timeline
- Operating cash flow stabilization and return to positive territory
Financial Metrics
Revenue
1.3M
Net Income
-2.8M
EPS (Diluted)
$-0.02
Free Cash Flow
-844.1K
Total Assets
2.0M
Cash
19.5K
Profitability Ratios
Gross Margin
58.5%
Operating Margin
-133.4%
Net Margin
-216.5%
ROE
N/A
ROA
-142.8%
FCF Margin
-64.2%
Balance Sheet & Liquidity
Current Ratio
0.16x
Quick Ratio
0.08x
Debt/Equity
N/A
Debt/Assets
559.3%
Interest Coverage
-1.97x
Long-term Debt
2.4M
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: 2026-03-23T19:16:12.454521 |
Data as of: 2023-06-30 |
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