Investment Thesis
Interlink Electronics is a micro-cap struggling with persistent unprofitability (-13.6% net margin) and negative free cash flow (-$168K) despite microscopic 1.8% revenue growth. While the fortress balance sheet with zero debt and strong 3.79x current ratio provides runway, the core business model has failed to achieve returns, and management shows no insider confidence with zero Form 4 filings in 90 days.
Strengths
- Fortress balance sheet with zero long-term debt and 0.00x debt-to-equity ratio
- Strong liquidity with 3.79x current ratio and $2.7M cash reserves covering 16+ quarters of cash burn
- Improving loss trend with net income and EPS declining at slower rates (17.1% and 18.8% improvements YoY)
Risks
- Deeply unprofitable with -13.6% net margin, -15.4% operating margin, and negative ROE (-17.5%) and ROA (-13.8%)
- Negative operating cash flow (-$112K) and free cash flow (-$168K) indicate core business cannot fund itself
- Stagnant revenue growth of 1.8% YoY on tiny $11.9M base with no visible market momentum or competitive advantage
Key Metrics to Watch
- Operating cash flow inflection point and timeline to positive FCF generation
- Revenue growth acceleration and gross margin sustainability
- Path to operating profitability and insider stock purchases indicating management confidence
Financial Metrics
Revenue
11.9M
Net Income
-1.6M
EPS (Diluted)
$-0.13
Free Cash Flow
-168.0K
Total Assets
11.7M
Cash
2.7M
Profitability Ratios
Gross Margin
38.9%
Operating Margin
-15.4%
Net Margin
-13.6%
ROE
-17.5%
ROA
-13.8%
FCF Margin
-1.4%
Balance Sheet & Liquidity
Current Ratio
3.79x
Quick Ratio
2.71x
Debt/Equity
0.00x
Debt/Assets
21.4%
Interest Coverage
N/A
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: 2026-04-12T15:33:22.983632 |
Data as of: 2025-12-31 |
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