Investment Thesis
Freeze Tag faces severe financial distress with negative stockholders' equity of -$821.9K, indicating technical insolvency and liabilities exceeding assets. The company is unprofitable with deteriorating fundamentals: negative operating cash flow of -$81.1K, shrinking revenue (-6.5% YoY), and a critical liquidity crisis with current ratio of 0.13x, making operational survival questionable without significant capital restructuring.
Strengths
- Minimal capital expenditure requirements suggesting asset-light software business model
- Positive revenue base of $1.3M indicating some ongoing customer activity
- Cash position of $108.2K provides short-term operational runway
Risks
- Negative stockholders' equity indicates technical insolvency and potential covenant violations
- Severe liquidity crisis with current ratio of 0.13x creates immediate going concern risk
- Negative operating cash flow of -$81.1K with $108.2K cash implies only ~16 months of runway at current burn rate
- Revenue contraction of 6.5% YoY demonstrates declining market demand or customer retention issues
- Net margin of -12.8% and operating margin of -11.9% indicate fundamental business unprofitability
- Long-term debt of $626.2K represents 77% of liabilities with no clear debt service capability
Key Metrics to Watch
- Monthly cash burn rate and remaining runway
- Revenue stabilization or return to growth trajectory
- Progress on debt restructuring or equity recapitalization efforts
- Operating cash flow return to positive territory
Financial Metrics
Revenue
1.3M
Net Income
-163.4K
EPS (Diluted)
$0.00
Free Cash Flow
-81.1K
Total Assets
406.3K
Cash
108.2K
Profitability Ratios
Gross Margin
N/A
Operating Margin
-11.9%
Net Margin
-12.8%
ROE
N/A
ROA
-40.2%
FCF Margin
-6.3%
Balance Sheet & Liquidity
Current Ratio
0.13x
Quick Ratio
0.13x
Debt/Equity
N/A
Debt/Assets
302.3%
Interest Coverage
-3.58x
Long-term Debt
626.2K
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: 2026-03-25T07:40:10.778979 |
Data as of: 2025-09-30 |
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