Investment Thesis
CalEthos is in severe financial distress with zero revenue, negative stockholders' equity of $2.4M, and a highly negative ROA of -2001.4%, indicating asset destruction and operational failure. The company is burning cash with -$1.0M free cash flow, has minimal liquidity (0.25x current ratio), and liabilities exceeding assets by a significant margin, suggesting insolvency risk.
Strengths
- Minimal cash position of $274K provides temporary operational runway
- Low trading volume on OTC suggests limited shareholder dilution exposure
- Asset base of $287K presents potential liquidation floor value
Risks
- Zero revenue with negative 100% YoY change indicates complete business collapse
- Negative stockholders' equity of -$2.4M indicates technical insolvency
- Severe liquidity crisis with 0.25x current ratio and only $274K cash against $2.7M liabilities
- Negative free cash flow of -$1.0M annually unsustainable with current cash reserves
- Net loss of -$5.7M and operating losses demonstrate no path to profitability
- No insider activity in 90 days may indicate abandoned management
Key Metrics to Watch
- Stockholders equity trajectory - any further deterioration confirms insolvency
- Cash burn rate and runway - $274K at -$513K operating cash flow = <2 quarters liquidity
- Revenue generation - must demonstrate any viable business model
- Debt restructuring developments - critical to address $2.7M liability overhang
Financial Metrics
Revenue
0.0
Net Income
-5.7M
EPS (Diluted)
$-0.22
Free Cash Flow
-1.0M
Total Assets
287.0K
Cash
274.0K
Profitability Ratios
Gross Margin
N/A
Operating Margin
N/A
Net Margin
N/A
ROE
N/A
ROA
-2,001.4%
FCF Margin
N/A
Balance Sheet & Liquidity
Current Ratio
0.25x
Quick Ratio
0.25x
Debt/Equity
N/A
Debt/Assets
951.2%
Interest Coverage
-2.30x
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: 2026-03-25T17:24:11.703161 |
Data as of: 2025-09-30 |
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