Investment Thesis
HeartSciences exhibits severe financial distress with revenue collapsed to $4.3K (down 76.6% YoY) while burning $5.8M annually in operating losses, creating an unsustainable burn rate. With $3.4M in cash against -$5.8M annual operating cash flow, the company has approximately 7 months of runway without a dramatic operational turnaround. The combination of near-zero revenue, massive losses, negative returns on capital, and accelerating cash depletion indicates high bankruptcy risk.
Strengths
- Maintains $3.4M cash position representing 45% of total assets
- Zero long-term debt burden with 0.00x debt-to-equity ratio
- Positive 59.1% gross margin indicates product has potential value if scalable
Risks
- Revenue essentially zero at $4.3K with -76.6% YoY decline indicates business collapse
- Operating cash flow of -$5.8M annually creates ~7 month cash runway at current burn rate
- Operating loss of -$5.9M on minimal revenue reflects severe operational inefficiency and inability to scale
- Negative ROE (-241%) and ROA (-84.6%) demonstrate destruction of shareholder capital
- No meaningful path to profitability visible with current revenue base
Key Metrics to Watch
- Quarterly revenue trajectory and any evidence of stabilization or rebound
- Monthly cash burn rate and updated runway estimation
- Operating cash flow sign and magnitude - must improve to positive or funding required
Financial Metrics
Revenue
4.3K
Net Income
-6.4M
EPS (Diluted)
$-2.10
Free Cash Flow
-5.8M
Total Assets
7.6M
Cash
3.4M
Profitability Ratios
Gross Margin
59.1%
Operating Margin
-136,060.7%
Net Margin
-147,973.4%
ROE
-241.0%
ROA
-84.6%
FCF Margin
-133,218.6%
Balance Sheet & Liquidity
Current Ratio
1.19x
Quick Ratio
1.04x
Debt/Equity
0.00x
Debt/Assets
64.9%
Interest Coverage
-16.60x
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: 2026-04-11T08:39:21.460605 |
Data as of: 2026-01-31 |
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