Investment Thesis
InnSuites is a financially distressed REIT with persistent operating losses, negative free cash flows, and dangerously low liquidity ($14K cash) relative to $11.3M long-term debt. The company cannot service interest from operations (coverage ratio of -0.5x) and carries excessive leverage (3.12x debt-to-equity) while generating essentially flat revenues with no profitability improvement.
Strengths
- Current ratio of 1.09x indicates minimal coverage of short-term liabilities
- Still operating without bankruptcy filing as of latest reporting date
- Stockholders equity of $3.6M remains positive despite losses
Risks
- Critical liquidity crisis with only $14K cash against $11.3M long-term debt
- Total liabilities ($14.0M) nearly equal total assets ($13.9M) - severe balance sheet stress
- Negative interest coverage (-0.5x) indicates inability to pay interest from operations
- Persistent operating losses with -3.4% operating margin and -15.0% net margin
- Negative operating and free cash flows indicate ongoing cash burn
- Excessive leverage at 3.12x debt-to-equity ratio with minimal equity cushion
- Flat revenue growth (+0.1% YoY) shows no demand recovery or growth trajectory
Key Metrics to Watch
- Cash balance and monthly burn rate
- Operating cash flow trends and path to positive operations
- Debt refinancing ability and covenant compliance
- Occupancy rates and revenue per available room (RevPAR) metrics
Financial Metrics
Revenue
5.8M
Net Income
-869.1K
EPS (Diluted)
$-0.10
Free Cash Flow
-18.2K
Total Assets
13.9M
Cash
14.0K
Profitability Ratios
Gross Margin
N/A
Operating Margin
-3.4%
Net Margin
-15.0%
ROE
-24.0%
ROA
-6.3%
FCF Margin
-0.3%
Balance Sheet & Liquidity
Current Ratio
1.09x
Quick Ratio
1.09x
Debt/Equity
3.12x
Debt/Assets
101.1%
Interest Coverage
-0.48x
Long-term Debt
11.3M
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: 2026-04-11T16:57:20.469400 |
Data as of: 2025-10-31 |
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