Investment Thesis
Groove Botanicals is technically insolvent with negative stockholders' equity of -1.4M against minimal assets of 6.3K, indicating the company is balance-sheet bankrupt. The company burns cash operationally (-75.7K) with near-zero revenue (-8.6K) and no liquidity buffer (1.5K cash), making near-term survival questionable without massive capital injection or operational restructuring.
Strengths
- Revenue shows YoY growth of 31.1% (though from negative base, indicating scale issues)
Risks
- Negative stockholders' equity indicates technical insolvency and balance sheet bankruptcy
- Virtually no cash (1.5K) relative to 1.4M liabilities - acute liquidity crisis
- Negative operating cash flow of -75.7K with near-zero revenue demonstrates fundamental business model failure
- Current/Quick ratios of 0.00x indicate inability to meet short-term obligations
- Negative interest coverage (-6.3x) means company cannot service debt from operations
- Minimal asset base (6.3K) provides no cushion for unexpected challenges
Key Metrics to Watch
- Stockholders equity trend - must return to positive to avoid bankruptcy
- Monthly cash burn rate and months of runway remaining
- Revenue stabilization and path to profitability or operating breakeven
Financial Metrics
Revenue
-8.6K
Net Income
-104.4K
EPS (Diluted)
$0.00
Free Cash Flow
-98.3K
Total Assets
6.3K
Cash
1.5K
Profitability Ratios
Gross Margin
N/A
Operating Margin
1,212.2%
Net Margin
1,212.2%
ROE
N/A
ROA
-1,668.1%
FCF Margin
1,141.5%
Balance Sheet & Liquidity
Current Ratio
0.00x
Quick Ratio
0.00x
Debt/Equity
N/A
Debt/Assets
22,114.9%
Interest Coverage
-6.25x
Long-term Debt
149.2K
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: 2026-04-10T19:36:23.419177 |
Data as of: 2025-12-31 |
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