Investment Thesis
iPower exhibits severe operational losses despite 15,263% revenue growth and a healthy 36.9% gross margin, indicating uncontrolled SG&A expenses and inability to scale profitably. While positive operating cash flow and minimal debt are offsetting factors, the company's thin cash position (~$714K) relative to operating burn and negative net margin of -28% present material solvency risks.
Strengths
- Explosive revenue growth of 15,263% YoY indicates strong market demand or successful market entry
- Positive operating cash flow of $430.4K and free cash flow of $266.8K despite net losses show operational viability
- Conservative capital structure with debt-to-equity of 0.03x and manageable long-term debt of $441.5K
Risks
- Critical cash burn with only $713.7K cash against negative net income of -$5.2M; runway concerns at current operating cadence
- Operating margin of -27.8% indicates fundamental inability to control operating expenses despite 36.9% gross margin; SG&A ratio likely exceeds 60% of revenue
- Negative return metrics (ROE -30.2%, ROA -16.6%) and interest coverage of -38.9x signal deteriorating shareholder value and financial stress
Key Metrics to Watch
- Operating expense ratio and path to operating margin breakeven
- Cash burn rate and quarterly cash position relative to operating liabilities
- Gross margin sustainability and SG&A efficiency gains as revenue scales
Financial Metrics
Revenue
18.5M
Net Income
-5.2M
EPS (Diluted)
$-4.32
Free Cash Flow
266.8K
Total Assets
31.3M
Cash
713.7K
Profitability Ratios
Gross Margin
36.9%
Operating Margin
-27.8%
Net Margin
-28.0%
ROE
-30.2%
ROA
-16.6%
FCF Margin
1.4%
Balance Sheet & Liquidity
Current Ratio
2.20x
Quick Ratio
1.81x
Debt/Equity
0.03x
Debt/Assets
45.2%
Interest Coverage
-38.90x
Long-term Debt
441.5K
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: 2026-05-23T08:35:16.945095 |
Data as of: 2026-03-31 |
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